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With the Tax Deadline Fast Approaching, Here's What You Need to Know

Information from the IRS on free tax prep software, what to do if you can't pay on time, how to get help from the IRS and "everything you need to know about making tax payments."

From the IRS: 

Here is information on Free File, free software that will help taxpayers prepare and e-file taxes; Tips for taxpayers who can't pay their taxes on time; Tips for people who pay estimated taxes; How to get tax help from the IRS; And "Everything You Need To Know About Making Tax Payments." 

Free File Still Available for Last-Minute Filers 

The tax deadline is fast approaching and even though the April 17 deadline offers a couple of extra days this year, the IRS wants to remind taxpayers who haven't filed yet that IRS Free File is still available.

For people who find taxes a little too taxing, IRS Free File offers free software to prepare and e-file your taxes for free. Get started at IRS.gov/freefile. Here are four tips about IRS Free File.

1. Free File Does the Hard Work for You Free File is a partnership between the IRS and leading tax software providers who make their brand-name products available for free. You don’t need to be a tax expert; the software will help find tax breaks for you, such as the Earned Income Tax Credit. The software asks the questions; you supply the answers. It will find the right tax forms and do the math.

2. Access to Free File products You must access the Free File products through www.irs.gov to avoid any charges for preparing or e-filing your federal tax return. Once you choose a Free File software product, you'll be directed away from the IRS website to the partner’s site to prepare, print and e-file your federal return – all for free.

  • Free options for all There is a free option for everyone. People who make $57,000 or less, which includes most Americans, can use the Free File software. People who make more can use Free File Fillable Forms, an electronic version of IRS paper forms.
  • Free Extensions Taxpayers who can’t make the April 17 deadline can request an extension. Making the request is easy and free through IRS Free File. Just look for “free extensions” in the company offers. Remember, this is an extension of time to file your return, not to pay. If you think you owe, make a payment with your extension request. 

Get all the information you need about IRS Free File at IRS.gov/freefile.

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Tips for Taxpayers Who Can't Pay Their Taxes on Time

If you owe tax with your federal tax return, but can't afford to pay it all when you file, the IRS wants you to know your options and help you keep interest and penalties to a minimum.

Here are some tips:

  • File your return on time and pay as much as you can with the return. These steps will eliminate the late filing penalty, reduce the late payment penalty and cut down on interest charges. For electronic and credit card options for paying see www.irs.gov. You may also mail a check payable to the United States Treasury
  • Consider obtaining a loan or paying by credit card. The interest rate and fees charged by a bank or credit card company may be lower than interest and penalties imposed by the Internal Revenue Code.
  • Request an installment payment agreement. You do not need to wait for IRS to send you a bill before requesting a payment agreement. Options for requesting an agreement include:
  • ·Using the Online Payment Agreement application atwww.irs.gov, and completing and submitting IRS Form 9465-FS,Installment Agreement Request, with your return
  • IRS charges a user fee to set up your payment agreement. See www.irs.gov or the installment agreement request form for fee amounts.
  • Request an extension of time to pay. For tax year 2011, qualifying individuals may request an extension of time to pay and have the late payment penalty waived as part of the IRS Fresh Start Initiative. To see if you qualify visitwww.irs.gov and get form 1127-A, Application for Extension of Time for Payment. But hurry, your application must be filed by April 17, 2012.
  • If you receive a bill from the IRS, please contact us immediately to discuss these and other payment options. Ignoring the bill will only compound your problem and could lead to IRS collection action.

If you can’t pay in full and on time, the key to minimizing your penalty and interest charges is to pay as much as possible by the tax deadline and the balance as soon as you can. For more information on the IRS collection process go to www.irs.gov or see IRSVideos.gov/OweTaxes.

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Tips for People Who Pay Estimated Taxes

You may need to pay estimated taxes to the IRS during the year if you have income that is not subject to withholding. This depends on what you do for a living and the types of income you receive.

These stips from the IRS explain estimated taxes and how to pay them. 

1. If you have income from sources such as self-employment, interest, dividends, alimony, rent, gains from the sales of assets, prizes or awards, then you may have to pay estimated tax.

2. As a general rule, you must pay estimated taxes in 2012 if both of these statements apply: 1) You expect to owe at least $1,000 in tax after subtracting your tax withholding (if you have any) and tax credits, and 2) You expect your withholding and credits to be less than the smaller of 90 percent of your 2012 taxes or 100 percent of the tax on your 2011 return. Special rules apply for farmers, fishermen, certain household employers and certain higher income taxpayers.

3. For Sole Proprietors, Partners and S Corporation shareholders, you generally have to make estimated tax payments if you expect to owe $1,000 or more in tax when you file your return.

4. To figure your estimated tax, include your expected gross income, taxable income, taxes, deductions and credits for the year. Use the worksheet in Form 1040-ES, Estimated Tax for Individuals, for this. You want to be as accurate as possible to avoid penalties. Also, consider changes in your situation and recent tax law changes.

5. The year is divided into four payment periods, or due dates, for estimated tax purposes. Those dates generally are April 15, June 15, Sept. 15 and Jan. 15 of the next or following year.

6. Form 1040-ES, Estimated Tax for Individuals, has everything you need to pay estimated taxes. It includes instructions, worksheets, schedules and payment vouchers. However, the easiest way to pay estimated taxes is electronically through the Electronic Federal Tax Payment System, or EFTPS, at www.irs.gov. You can also pay estimated taxes by check or money order using the Estimated Tax Payment Voucher or by credit or debit card.

For more information on estimated taxes, refer to Form 1040-ES and its instructions and Publication 505, Tax Withholding and Estimated Tax. These forms and publications are available at www.irs.gov or by calling 800-TAX-FORM(800-829-3676).  

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How to Get Tax Help from the IRS

When tax season is in full swing, the Internal Revenue Service receives millions of calls and thousands of taxpayer visits daily. For faster service, avoid peak times like Monday and Friday mornings when wait times are usually longest. Better yet, get the help you need online 24/7 without delay at IRS.gov.

The IRS website has a wealth of information, including hundreds of publications and guides on almost any tax-related topic. The instructions for a particular form can often provide the answers you need. TheInteractive Tax Assistant can also help. It's a tax law resource that asks a series of questions and provides you with responses to common tax law questions.

Many taxpayers call the IRS's main help line when they could easily help themselves at www.irs.gov or get services more directly from automated or specialized phone lines.

  • Check on your refund Use the "Where's My Refund?" tool at www.irs.gov or the automated system at 1-800-829-1954. IRS Phone representatives don't have any additional information beyond what these tools provide. 
  • Get forms and publications If all you need is forms or publications, download and print them at www.irs.gov or call 1-800-TAX-FORM (800-829-3676) to have them mailed, for free, to your home. 
  • Get previous years' tax info You can order a transcript of your account at www.irs.gov.
  • Payment plans If you can't pay the tax you owe, you can apply for an installment agreement using the Online Payment Agreement application, or you can print the Form 9465, Installment Agreement Request from www.irs.gov, then complete and mail it.
  • Business taxpayers Taxpayers with small business-related questions should call 1-800-829-4933.
  • Understanding a notice If you received a notice, call the number on your notice, not the main help line, to reach the IRS staff trained to help with that issue. 
  • Specialized reasons If you're calling for a very specific reason, there may be a direct phone number you should call instead of the main IRS help line. Visit the "Contact Us" link atwww.irs.gov to get more information on contacting the IRS about reporting identity theft or fraud, reaching the Taxpayer Advocate Service, voluntarily disclosing offshore accounts, information on the Health Coverage Tax Credit, or if you're calling from outside the United States.  

Some taxpayers prefer face-to-face tax help. The IRS sponsors Volunteer Income Tax Assistance and Tax Counseling for the Elderly sites in local communities. To find the closest site, search “VITA” onwww.irs.gov or call 1-800-906-9887. Call 1-888-227-7669 to find TCE sites through AARP, an IRS partner. The IRS also has Taxpayer Assistance Centers located throughout the country. To find IRS offices, use the locator tool found through “Contact Your Local IRS Office” onwww.irs.gov. Be sure to check office hours and services offered before visiting your local IRS office.

There may be some circumstances when you need to call the IRS main taxpayer assistance line, which is 1-800-829-1040. Here are a couple of tips on when to call:

  • Call if you have questions about your tax account such as a high dollar balance due or the balance due on your installment agreement.
  • Call the IRS if you can’t figure out how or if certain tax laws apply to your situation. IRS representatives can discus your individual circumstances and help you understand your tax obligations or benefits. 

Everything You Need to Know About Making Federal Tax Payments 

If you need to make a payment with your tax return this year, the IRS wants you to know about its payment options. Here are 10 important facts to help you make your tax payment correctly.

  • Never send cash!
  • If you file electronically, you can file and pay in a single step by authorizing an electronic funds withdrawal via tax preparation software or a tax professional. 
  • Whether you file a paper return or electronically, you can pay by phone or online using a credit or debit card.
  • Electronic payment options provide an alternative to checks or money orders. You can pay taxes or user fees 24 hours a day, seven days a week. Visit the IRS website at www.irs.gov and search e-pay, or refer to Publication 3611, Electronic Payments for more details.
  • If you itemize, you may be able to deduct the convenience fee charged for paying individual income taxes with a credit or debit card as a miscellaneous itemized deduction on Form 1040, Schedule A, Itemized Deductions. The deduction is subject to the 2 percent limit. 
  • If you file on paper, you can enclose your payment with your return but do not staple it to the form.
  • If you pay by check or money order, make sure it is payable to the “United States Treasury.
  • Always provide on the front of your check or money order your correct name, address, Social Security number listed first on the tax form, daytime telephone number, tax year and form number.
  • Complete and include Form 1040-V, Payment Voucher, when mailing your payment to the IRS. Double-check the IRS mailing address. This will help the IRS process your payment accurately and efficiently
  • For more information, call 800-829-4477 and select TeleTax Topic 158, Ensuring Proper Credit of Payments. You can also find out more in Publication 17, Your Federal Income Tax and Form 1040-V, both available atwww.irs.gov or by calling 800-TAX-FORM (800-829-3676).

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