Final Countdown to Tax Day – 7 days until April 18, 2017 at 11:59:59PM
With a week to go until the tax deadline, nearly 1 in 4 taxpayers wait until the last week of “tax season” to file their taxes. Americans waiting longer to file their returns is a consistent trend with individual fillings running 5.8 percent behind previous years. Perhaps it’s the extended deadlines in both 2016 and 2017 to April 18th or simple procrastination, but in the days following April 15th, over 12 million tax returns were filed according to IRS filing season statistics data. https://www.irs.gov/uac/2017-and-prior-year-filing-season-statistics
With April 15th falling on a Saturday this year, normally the deadline would be extended to the next business day. In 2017 and as a result of Washington D.C celebrating Emancipation Day on Monday, April 17th, the deadline moves to Tuesday giving taxpayers another day to file a completed return or an extension.
Before time runs out, a few important keys to getting taxes done and won include:
- File Something Even If You Can’t Pay Now
The best tax planning is to always owe something to the government because getting a tax return means they are giving you back your own money tax free. But if you owe more that you pay right now, do not forgo filing something by the deadline. First and foremost, taxpayers should file a return and extension to file to avoid the penalty for not paying taxes owed of 0.5 percent per month and for not filing a return at all at 5 percent per month. For example, someone owes $3,500 dollars, the failure-to-file penalty is $175.00 per month until filed, while the failure-to-pay is only $17.50/month. IRS installment information can be found here: https://www.irs.gov/uac/about-form-9465
Having the right documents is critical for substantiating what happened during the year and ensuring you don’t overpay or underpay your taxes. Collecting and documenting all W-2’s and 1099 reporting forms for all income sources, along with receipts for charitable donations, tuition receipts for higher education, and personal property/mortgage receipts are excellent resources to help file accurate tax returns. Whether you DIY or seek professional tax assistance; without supporting documentation, you run the risk of paying too much or receiving too little in return. For IRS tips on deducting charitable contributions: https://www.irs.gov/uac/eight-tips-for-deducting-charitable-contributions
- Leave No Room for Mistakes and Misunderstandings
Mistakes on tax returns may result in overpaying, underpaying, or delaying tax refunds. With the tax filing deadline only days away, many filers get in a hurry to meet the deadline and as a result, errors and mistakes could occur. Steering clear of these common mistakes include:
- Selecting the wrong filing status (single, married, head of household). Single generally applied if you are not married. Married usually applies if you and your spouse file a joint tax return. Head of household applies if you are not married and have paid more than half the cost of keep up a home by yourself. For more information on choosing the correct filing status, check out these IRS tips: https://www.irs.gov/uac/choosing-the-correct-filing-status
- Neglecting to include the important and required W-2’s and 1099’s
- Claiming ineligible dependents
- Miscalculating education or dependent credits
- Don’t Leave Money on the Table
Many studies have revealed that when taxpayers prepare their own tax returns, 1 in 4 leave money behind without claiming it. Taxpayers leave money on the table costs an average $400 dollars per household total over a billion dollars! Several ways to avoid this include being sure to itemize correctly, claiming correct education credits and tax breaks, going paperless to find mistakes before they happen, and claiming eligible sales tax for new automobile purchases. For more information on tax credits and deductions, see here: https://www.irs.gov/credits-deductions
Tax Season 2017 is (almost) in the books!
April 8, 2017
If you need assistance, look no further than
Randolph Business Resources, LLC.
Our experienced staff is ready to lend a hand to you and your business.
Visit us @ randolphacctg.com
Call us at: (615)202-5829 if you need immediate assistance