Final Push being made for taxes
There is still a light at the end of the tunnel for those who have either forgotten or feel they are running out of time to prepare tax papers and erase tax debts.
Thursday marks the last day for those who owe on their taxes and want to avoid interest and failure-to-pay penalties.
The Internal Revenue Service (IRS) advises that if a person is unable to pay the full amount he/she owes, that person will still benefit from filing a return and paying as much as possible by April 15 because interest and failure-to-pay penalties are due only on the unpaid balance.
Russellville Certified Personal Accountant (CPA) Joe Tucker said if a person even thinks they may owe money, it is important to either file a return or request an extension to avoid the failure-to-file penalty.
“My advice to those who may be running a little late filing is not to panic, I’d rather see you do it accurately than rush into it thinking about the deadline,” Tucker said. “Extensions are easy to request. If you haven’t filed, go ahead and do an automatic extension, then you will have six more months to get things in order.”
Taxpayers who need extra time to file their federal returns this year can file the Form 4868 request for an automatic extension through IRS Free File. The extension gives until Oct. 15, 2010 to file the tax return.
“If you decide not to do the extension, there will be some interest and penalties after April 15,” Tucker said.
Tucker said an extension of time to file is not an extension of time to pay.
Those who are struggling should estimate their tax liability and pay any balance due when the extension is requested.
Several payment options are available including electronic funds withdrawal, credit card and check.
There have been glimpses of relief when filing taxes this year. Some people have chosen to take advantage of options that may have been overlooked in the past.
CPA Welton Welborn of Welton’s Tax Consultant in Phil Campbell said there has been a lot of buzz about the residential energy credit and American opportunity education credit this year.
“Some of the things we’ve seen is people doing things to their homes, making them more insulated and energy efficient,” he said. “There has been a lot of questions about the residential energy tax credit and I believe it is a good thing to have or do for this tax season.”
Welborn said his clientele has shrunk a little because of technology and the economy.
“A lot of our clients have went to other methods of filing their taxes lately,” he said. “I figure most of them either went to filing online or are not required to because they are unemployed.”
The IRS expects to receive approximately 10 million extension requests in 2010, which is about the same as last year. Some taxpayers automatically receive extensions to file. For example, military personnel serving in a combat zone have 180 days after leaving the combat zone to file their returns. Victims of recent natural disasters in certain federally declared disaster areas also have extra time. For more information on tax penalties, procedures and deadlines visit www.irs.gov.
