Tax Day 2016 falls on Monday, April 18th. That’s literally right around the corner.
If you haven’t even thought about filing your taxes yet, you aren’t alone. According to recent IRS data, nearly a quarter of all American taxpayers wait until the final two weeks of tax season to actually file their personal returns with Uncle Sam.
Although you might be in a panic to beat the clock, there are several simple steps you can take to get everything together, prepared, and filed with the IRS on time so you don’t have to file for an extension of time and, in essence, delay the inevitable of eventually filing your return by October 18th.
1. Organize your important documents.
If you haven’t kept an organized file of financial records, receipts, bank statements and other relevant info you’ll need to put on your return, it’s time to get moving on organization. Put all of this paperwork into different file folders for each category. If you have important financial records on your computer, you may want to print them out so you can sit down at your desk and go through the hard copies of everything you need.
2. Spend enough time on your return.
It’s never a good idea to race through any task, especially when it comes to tax preparation and dealing with the IRS. Plan enough time to focus on your tax return. Make sure all of your math is correct with your W-2 income, 1099 contract income, personal tax deductions, personal tax credits, personal exemptions, and any other financial figures. The last thing you want is to get audited because you hastily threw together Form 1040 so you wouldn’t miss the deadline.
3. Don’t forget the other tax-related deadlines.
Not only is Tax Day the deadline for all personal income tax returns to be filed by, but it also represents a few other deadlines. Contributions to retirement accounts with tax benefits – such as traditional IRAs and Roth IRAs – must be made by this date. Plus, estimated tax payments for Q1 of the year are due on this date for self-employed professionals and small business owners.
4. Let an accountant handle your tax filings.
Accounting firms are often slammed as Tax Day approaches. However, there are firms out there like 1-800Accountant that can make time to assist you so that your return is prepared properly and filed on time. Putting your tax return in the hands of an experienced accountant or CPA can help you rest easy. You’ll know that despite your last-minute filing, the return will be filled out and signed off on by a professional. If you file on your own in the waning moments, there is a much higher chance something could go wrong.
5. If you just don’t have enough time, consider an extension.
We all want to get our taxes prepared and filed on time. There are many reasons for this, such as getting your tax refund sooner and simply completing a stressful task until next year. But don’t fret if you have to file for an extension of time. The IRS is fairly generous about granting taxpayers an extension if they really need extra time to do their homework and ensure an accurate filing. A 6-month extension is the common amount of time taxpayers receive, but remember this extension is only for filing your return. You still must pay your taxes to the IRS by Tax Day to avoid late-payment penalties. An extension can help you avoid incurring a late-filing penalty.