Tax season can be a stressful time. There’s the pressure of having everything organized and on top of that, ensuring that everything is submitted on time. It’s no wonder why some panic days before tax returns are due. In 2016, a survey taken from the National Endowment for Financial Education (NEFE) showed that 58% of U.S. taxpayers worry about filing their taxes. Why put so much stress into filing when you can overcome your fears? Let’s discuss some common tax problems and the solutions to fixing them.
Don’t panic about missing the tax filing deadline
Life can get pretty busy so it’s easy to procrastinate about certain things. When it comes to taxes, they shouldn’t be forgotten about for a prolonged period of time. If you’re worried about missing the tax return deadline, there’s a form for filing an extension to turn your taxes in at a later date. Form 4868, Application for Automatic Extension of Time to File U.S. Individual Income Tax Return, allows the individual up to 6 months extra time. There are a few requirements to qualify:
- You must properly estimate your 2017 tax liability using the information available to you.
- Enter your total tax liability on line 4.
- File form 4868 by the regular due date of your return. In this case, it would be April 17th, 2018.
Are you worried about not having the required paperwork?
The solution to this problem can be simple. Keep your paperwork organized and in one place. If being organized was a challenge this year, start looking into ways that will help you stay dedicated for next year’s tax season. Here are some simple solutions to staying organized when it comes to important documents and papers:
- Create and organize a desktop filing station.
- Make labels and mark everything down, keeping similar documents together.
- Create a tax binder with tabs labeled with topics such as income, invoices, expenses, mileage etc.
- Try online book-keeping if you’re on the run. Look into programs such as Outright or Waves.
Mistakes can happen
Another survey recorded by NEFE reported that about 18% of Americans have anxiety when it comes time to filing their returns incorrectly. Being anxious about getting a number wrong or forgetting something is understandable as this can lead to having to re-do your taxes or even an audit. Help yourself to avoid making a mistake by hiring a professional. Most people aren’t tax experts unless you’re an accountant, attorney or professional tax preparer so don’t be afraid to ask for help or seek an advisor. It’s better to be safe than sorry.
What to do if you owe
The NEFE tax poll showed that 26% of people worry about the possibility of owing taxes to the government. This fear of owing money might be somewhat inflated since virtually 8 out of 10 taxpayers actually receive a refund on their taxes. If you do owe money, file your taxes regardless and work out a payment plan if need be. Try not to get too much anxiety about this as there are some routes you can take if you owe:
- Pay with your tax bill with a credit card.
- Go online and request an installment agreement (for up to 6 years) if you need even more time. To do so, fill out IRS Form 9465- Installment Agreement Request.
All of these problems and fears can add up. Especially since life can get busy, your taxes and documents tend to get left behind. Don’t be afraid to get a head start on your taxes and definitely do not let your fears consume you from filing early or on time. If you have any questions or would like to hire a professional tax preparer, don’t hesitate to call us at (855) 851-8318 or visit www.bodineperry.com.