Welcome to yet another tax season.

 

With a matter of days remaining until the April 15 IRS income tax deadline, the stress level of Americans is on the rise. Prepare yourself for more angry drivers on the freeways, impatient customers in the lines of local coffee shops and grocery stores, and friends who don’t quite treat you like the friends they were only weeks ago.

 

Looking for a way to cut down on the April tax time blues? There’s a little known secret called an IRS tax extension (the technical term is an IRS Form 4868 – Application for Automatic Extension of Time To File U.S. Individual Income Tax Return), and a company called FileLater who can help. Of 130M United States federal income tax filers, about 10M filed for automated extensions last year, so you won’t be alone. And the IRS doesn’t ask (or care) why you file for an extension.

 

Almost every tax-paying American is automatically eligible to file an IRS tax extension, and it can be easy to do. In about 5 minutes, you can go to File Later’s website, answer a handful of relatively simple questions, and have your tax extension e-filed to the IRS for you. In a couple of days, you’ll get an email with IRS confirmation that your new tax deadline is October 15.

 

To file a tax extension online you’ll need to provide some basic personal information, and an estimate of your tax liability. Don’t have a clue if you owe or if you’ll be getting a refund? Don’t worry, the better tax extension filing services like FileLater will provide you with a simple calculator to make determining your tax liability easy.

 

If you’re in the minority of tax filers who will owe money to the IRS (rather than getting a refund) the IRS will still want their money by April 15 or you could be hit with a late payment penalty. Filing a tax extension will give you the extra 6 months to file your tax return, but it doesn’t give you extra time to pay the IRS. That means you either have to mail a check postmarked by April 15 to the IRS or provide bank information online for an automatic withdrawal. If you expect to get a refund, then there’s nothing to consider.

 

The deadline for filing your income tax extension is April 15. A simple 5 minutes with File Later can give you an additional 6 months to file your taxes, and your stressed out CPA or tax professional will love you for it.

If you are excited at the prospect of doing your taxes, you are one of the few lucky ones. For most of us mere mortals, our taxes are an incredibly intimidating and complex beast.
Needless to say, the U.S. tax code does not make for a light read. Nonetheless, you are still obliged to file and pay your taxes, no matter how daunting the task may be. Fortunately, help may just be a phone call away.
This article will discuss various methods you can use to make filing your taxes as stress-free as possible.
Using professional tax preparation tools (people and software)
What is the most important benefit to having a tax professional prepare your tax return? Not having to prepare your tax return yourself.
It is as simple as that; preparing and filing your own tax return will take up a lot of your valuable time, and could end up causing you a huge amount of stress and annoyance in your life. And no matter what, it is bound to be a perplexing and confusing process. Using a tax professional will take away most of your tax related stress (but not all of the stress, unfortunately you will still have to wait for your tax bill).
You will also have the added benefit of knowing that will be able to rest easy with the knowledge that someone who actually understands the U.S. tax code is preparing your taxes. This is especially important if your tax situations is particularly complex, or if you want to plan an aggressive tax strategy as part of a larger financial plan.
What professional solution is right for you?
You have two main professional solution choices: people or software. If your tax situation is especially complex, or if you are a small business owner, than you should consider getting either an Enrolled Agent (EA) or a Certified Public Accountant (CPA) to prepare your income taxes.
The advantage of using either of these professionals is that you will avail yourself of the services of someone who has been certified to prepare people’s taxes, by either the state for CPAs or the IRS for EAs. This is important if you have a complex tax situation and you need to know that it is being handled properly.
If you just cannot take any risks, then hiring a professional is the way to go. If you face a more straightforward tax situation, you could probably get by using one of the many walk in services that fill the airways with advertising come tax time. As a final alternative, if you are more confident in your skills you should considering using tax filing software to finish your taxes off yourself.
With most software, it will just involve answering a series of questions; you will not just be left with an electronic version of the long form to fill out from scratch! And if your adjusted gross income is $52,000 or less, you will be able to find a software package to file your taxes for free under the government’s Free File program.
In the end, no matter what option you select, just be sure to plan ahead and file on time!

Many good folks each year fall behind in filing their tax returns. The largest reasons for not filing are fear of not knowing how to file and the thought of not being able to pay the balance due. Even if you are unable to pay you should file your return to avoid future penalties for not filing. Penalties for not filing can reach up to 25% of the amount due. If you are due a refund from the IRS there is no penalty for not filing. However, you should file as soon as possible to avoid losing your refund. After three years from the tax return due date you will not be eligible to collect a refund or claim tax credits on your return.

Don?t let the upcoming tax season fill you with dread. With a little preparation, you can learn to navigate the tax return preparation maze with confidence. To get you started, here are the basics of what you need to know when filing your tax return:

 

There are two ways in which to file your tax return, by IRS e-file or by mailing a paper return to the IRS.

Electronic Filing
IRS e-file is the electronic transmission of your tax return to the IRS. As a result, the processing of IRS e-file returns is more accurate than the processing of paper returns. You must have a valid Social Security number for every person included on the return to qualify for electronic filing.

 

If you e-file, your return is considered filed on time if the authorized electronic return transmitter postmarks the transmission by the due date. The electronic postmark is a record of when the authorized electronic return transmitter received the transmission of your electronically filed return on its host system. The date and time in your time zone controls whether the electronically filed return is timely.

Paper Returns

If you do not e-file your tax return, you can mail your return in the envelope provided with your tax form package. If you do not have an addressed envelope or you moved during the year, mail your return to the appropriate Internal Revenue Service Center listed for your state in your IRS tax form package.

 

Your paper return is filed on time if it is mailed in an envelope that is properly addressed and postmarked by the due date. If you send your return by registered mail, the date of the registration is the postmark date. The registration is evidence that the return was delivered. If you send a return by certified mail and have your receipt postmarked by a postal employee, the date on the receipt is the postmark date. The postmarked certified mail receipt is evidence that the return was delivered.

 

If you use a private delivery service designated by the IRS to send your return, the postmark date generally is the date the private delivery service records in its database or marks on the mailing label. The private delivery service can tell you how to obtain written proof of this date. IRS designated private delivery services are listed below:

 

* Airborne Express (Airborne): Overnight Air Express Service, Next Afternoon Service, and Second Day Service

* DHL Worldwide Express (DHL): DHL Same Day Service and DHL USA Overnight

* Federal Express (FedEx): FedEx Priority Overnight, FedEx Standard Overnight, FedEx 2Day, FedEx International Priority, and FedEx International First

* United Parcel Service (UPS): UPS Next Day Air, UPS Next Day Air Saver, UPS 2nd Day Air, UPS 2nd Day Air A.M., UPS Worldwide Express Plus, and UPS Worldwide Express

Filing Late

If you do not file your return by the due date, you may be subject to a failure-to-file penalty and interest. To avoid penalties and interest, file for an extension by before this date. If you were due a refund, but you did not file a return, you must file within three years from the date the return was originally due to obtain that refund.

Filing an Extension

When you file an extension, you can postpone filing your return until October 15. However, if you do not pay any tax owed by the due date, you will accrue penalty and interest charges. Complete Form 4868, Application for Automatic Extension of Time to File U.S. Individual Income Tax Return, to file for a six-month extension. If you estimate that you have a balance due, include this payment with the form.

 

For example, James and Sally Gaylord are married and file a joint return. Their home was damaged by a tornado and they have contacted their investment company to resend them Forms 1099 so they can file their tax return. It does not appear that they will have this information by April 17, so they decide to ask for an extension by filing Form 4868. James and Sally estimate that their total tax liability for 2006 will be $1,843. Their Forms W-2 indicate that a total of $1,215 of federal income tax has been withheld. To avoid late payment penalty and interest, James and Sally must pay $628 with their Form 4868.

E-filing Extensions

The IRS offers e-filing of extension applications. The IRS will process Form 4868 through the original due date of your tax return. By filing an extension, you postpone the filing date of your return until October 15; however, any tax due on the return will be subject to interest and penalties if not paid by the due date.

Installment Agreement

If you are not in bankruptcy and have a balance due, but cannot pay your full tax liability by the due date, you should consider the IRS installment plan. To request an installment agreement, complete Form 9465, Installment Agreement Request, and attach it to the front of your tax return or include it with an e-filed return. You can also request an Installment Agreement after you file your tax return by filing Form 9465 by itself to the address shown in the form instructions or by e-filing Form 9465 by itself. If the IRS approves the request, you will be charged a fee and interest on any unpaid balance. The fee has been increased in 2007 to $52 for agreements to pay direct debit and to $105 for all others. Although you generally may have up to 60 months to pay, you should make the payments large enough so that the balance due will be paid off by the due date of your next return. Before requesting an Installment Agreement, you should consider less costly alternatives, such as a bank loan.

Record Keeping

It is a good idea to keep your previous tax returns, as well as other important documents that have affected your income and deductions, for at least three years. If you need a copy of a prior- year return, you can obtain it for a fee from the IRS by filing Form 4506, Request for Copy of Tax Return. This can take up to 60 calendar days.

Change of Address

Are you planning a move before the end of the year? The IRS has an official change-of- address form, Form 8822, Change of Address. If you complete and mail this form to the appropriate IRS Service Center, you should receive your tax booklet at your new address.

 

For more tax tips and information on tax preparation, please visit the Tax Resource Center at http://www.jacksonhewitt.com.

About the Author

R.L. Fielding has been a freelance writer for 10 years, offering her expertise and skills to a variety of major organizations in the education, pharmaceuticals and healthcare, financial services, and manufacturing industries. She lives in New Jersey with her dog and two cats and enjoys rock climbing and ornamental gardening.