Tax season can be a hectic period for those who have to file. However, it does not have to be all that bad. With a little planning, you can avoid many of the common tax problems.
- Filing After Deadline
The tax return filing deadline for individuals is generally April 15th of the following year, unless that date falls on a weekend or holiday, in which case it may be moved back a day or two. If you are late in filing your tax returns, you have plenty of company. The IRS reported that millions of taxpayers fail to file before the deadline. Unfortunately, there are a number of consequences that come with filing late. You will most likely end up paying more in fines and penalties. Therefore, make sure to mark the date on a calendar, ensuring you don’t miss the deadline!
- Wrong Filing Status
There are different filing status options, including single, head of household, married filing jointly, and married filing single. It can get perplexing to know which status benefits you the most. Choosing the wrong status can make a drastic difference. There are a number of things that married couples are entitled to if they choose to file jointly, and a lot of disadvantages to filing single. Therefore, it is important to take the time and do some calculations, ensuring the best outcome for you. You must also be cognizant of which options are available to you.
- Math Errors
Remember when you were in a math class and made silly mistakes that you could have easily avoided if you would have just double-checked your work? Well, the same is true for your taxes. Give yourself some time to look over your math computations before you file or submit anything. If you feel you are struggling, consider contacting a tax consultant for help.
- Administrative Errors
Besides checking for any math errors, you also need to ensure you have completed all the forms correctly. This includes filling in every box that is required, using the correct forms, providing information correctly, etc. A number of people tend to commonly mess up writing in their social security number and bank account. Also, it is important to write legibly because in most cases, the IRS will send it back. Save yourself the headache and double-check!
- Inability to Pay
If you cannot afford to pay what you owe, you should consider looking into the repayment options the IRS makes available. Many people fail to file out of fear of a heavy tax burden. However, there is no need to worry because the IRS offers a number of repayment options, including the installment agreement, offer in compromise, IRS fresh start program, etc. These options will let you pay or extend your debt to protect your finances.
In response to the COVID-19 outbreak, the Internal Revenue Service and Treasury Department are providing special tax filing relief to all individuals and businesses. Therefore, the filing deadline has been extended from April 15, 2020, to July 15, 2020, allowing taxpayers to have an extra 90 days to file. Don’t wait, file today!