Tax Day Tips
If you’re not ready to file your taxes, you at least have to file something. You can file an extension. This is done with a Form 4868. You can actually do it online. But you have to at least pay based on your estimated income. So it’s not like you can avoid paying your taxes late, but you can just tell them, “I’m not quite ready; this is what I think I owe,” and they will set you up. Then, you will have an extra six months until October 15th to get it all done. That’s a big help for a lot of people with businesses as they’re trying to sort through and get their books done or if you’ve just been busy…things have been happening. That’s a way to avoid it (for now).
The other issue is some people say, “Well, I don’t have the money.” You can file another form to ask for installment payments. They’ll set you up if you can’t afford to pay it all at once, you can do the installment.
You can pay by credit card. I tell people: “Don’t do that unless you absolutely have to because there is a charge on top of your taxes of about 2%.”
I’m also encourage people. Today (April 15th) is the last day that you can contribute to your IRA accounts—Roth IRA or Traditional IRA—and get a tax break. You can actually lower your income taxes that are due by doing a Traditional IRA (be mindful of that year’s annual contribution limits). I always tell people: “Pay yourself before paying Uncle Sam.”
For more information, go to www.irs.gov. It’s a great website. Plug in your questions. You can find all the information you need there and forms.