Last Minute Tax Tips
Even though it’s common knowledge that tax day is April 15 (April 18 for filing 2015 taxes in 2016), many people wait until the last minute to file their income taxes.
According to the Internal Revenue Service, 20-25 percent of Americans wait until the two weeks prior to the deadline to prepare their tax returns. To avoid scrambling as tax season draws to a close, here are some tips to help you prepare and file your taxes – even at the last minute.
One of the biggest tax time hassles for many is getting the necessary documents together. To make preparing your taxes go smoother, make sure you have the information you will need, including all of those forms that come in January, such as W-2s, 1099, mortgage interest statements, student loan statements and any receipts related to moving, medical bills or work expenses before you sit down to file your return.
Itemize Your Deductions
While it’s easier to just take the standard deduction, you may be able to save more by itemizing – and it’s worth the added work if your qualified expenses add up to more than the 2015 standard deduction for an individual ($6,300) or married couple filing jointly ($12,600). Many deductions are well-known, including those for children, student loan or mortgage interest and charitable donations. However, there are other deductions available, such as job-related expenses, like work clothing and equipment, professional dues or business car expenses, that are deductible if the combined amount is more than 2 percent of your adjusted gross income, as well as medical expenses that exceed 10 percent of your adjusted gross income.
Get Help if You Need It
If you feel uncomfortable doing your taxes on your own, there are products and services available to help you file. You can speak with a tax professional to have them prepare your taxes or help you through the process, or use a computer program, which will help with everything from tracking deductions by answering simple questions, to selecting the correct forms for even the most complex returns while also allowing you to file electronically for a faster refund.
File Faster Online
Because the IRS processes electronic returns faster than mailed-in paper ones, there are several benefits that come with filing online, especially at the last minute when time is precious. Since online returns are processed faster, that means you can expect a faster refund – the wait time is even less if you elect to have your refund deposited directly into your account. The IRS also checks electronically filed returns for completion and sends acknowledgement of receipt to put your mind at ease.
Consider Requesting an Extension
If you don’t think you’ll be able to finish your return on time, make sure to file for an extension using Form 4868 by April 18. Extensions are generally approved automatically and grant you a six-month extension to file. An extension to file, however, is not an extension to pay owed taxes, so paying your estimated balance due is imperative when it comes to avoiding late-payment fees. If you’re worried about paying what you owe, the IRS recommends filing your taxes or an extension and then setting up a payment plan.
No matter the reason for the delay in filing, getting prepared and taking advantage of available resources can help you beat the deadline and get best possible refund.
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