4 Actions Taxpayers Can Take Before April
Wintertime and the holidays are hectic for all of us with family gifts, decorations, hosting holiday parties. However, one thing you need to keep track of is your finances, especially your taxes during this chaotic time.
Over the years we’ve seen several different preventive measures clients take to avoid the IRS. If you’ve fallen behind on your taxes this year or something else is awry with your IRS account, here are some actions taxpayers can take before the April tax deadline is upon us.
You need to start gathering all tax-related documents as soon as possible. You should have W-2s, 1099s, K-1s, and any other tax documents sent to your tax preparer right away to start the preparation process and give them time to focus on your tax return. The sooner you send in all your tax-related documents, the sooner you will find out if you will owe the IRS.
If your tax preparer looks over your documents and finds that you do owe the IRS, it’s essential to remain calm. Pay as much as you can with your return, as this will help reduce any penalties or interest you incur. Thankfully, the IRS has options for taxpayers who cannot pay their taxes in full, such as payment plans or a financial hardship determination.
File an Extension
Filing for an extension acts as a backup just in case something comes up and the return cannot be filed on time. With only one extension, you would be able to file as late as Oct. 15. It’s essential to keep in mind that the extension allows you to file later, not pay later, as taxes are still due by April 15.
Get Professional Help
If you feel your tax situation is complicated or has changed in any way, don’t hesitate to contact a licensed tax preparer. Self-employed taxpayers, independent contractors, homeowners and gig workers should consider a licensed tax preparer to ensure no filing errors or complications with the IRS. Start planning for the year ahead today.
~ Michael Raanan MBA, EA, Former IRS Agent