By Shirley Pulawski, My Bank Tracker
April 15 has come and gone, but if you didn’t file your tax bill, all is not lost, even if you think you will owe taxes. Take a deep breath and learn what you can do next to avoid serious consequences if you didn’t file your taxes by the April 15 deadline.
Take a deep breath and learn what you can do next to avoid serious consequences if you didn’t file your taxes by the April 15 deadline. PHOTO: Jeffrey Hamilton/Getty Images.
Get help if possible
First, no advice here is a good substitute for talking to a qualified tax professional about your situation. If you can afford to meet with one, do it, and be honest about the reasons that led you to avoid filing. They will make it their goal to help you set your situation straight.
Act now
Yes, the deadline has passed, but it wouldn’t be a bad idea to file for an extension using IRS form 4868, “Application for Automatic Extension of Time To File U.S. Individual Income Tax Return” following all of the instructions now. Really — right NOW is the time to file this. Yes, it will be late, but you’re showing good faith and an that you are making an attempt to rectify your mistake.
The bad news here is that if you are expecting to owe taxes, you will be expected to include a payment with the paperwork. However, the form states that you can make a partial payment, but there will be penalties involved. The IRS will charge interest on what you haven’t paid, and you may be charged a fee in addition to the interest. Pay as much as you can so that you won’t owe as much down the road.
Lost paperwork
If you are still waiting on W-2s or 1099 or other forms to report your income, and you didn’t keep good records or have lost paperwork, do your best to estimate the amount you earned. Be as honest and thorough as possible so that you don’t come in too low or too high, either of which could raise red flags later on.
If you are filing the extension on paper, consider including a note explaining the reasons behind the late filing. It isn’t required, but it can’t hurt if you have some solid reasons, such as some hardship that resulted in a loss of paperwork, or a complicated work year with a lot of details like expenses, a heavy load of private contracting with a large number of sources, or some other reason that complicated your efforts.
State what efforts you are making, but be accountable for your actions. “I forgot” isn’t a good reason. “I don’t have the money right now” might be more forthright, but list the attempts you’ve made and outline your strategy to make good on the debt. Keep it short, professional, positive, and to the point.
Read the full article by Shirley Pulawski from My Bank Tracker.
