I don’t have time to file my 2024 federal tax return or apply for a tax extension. By applying for an extension, you can push that date to October 15th. Given the reduced staffing in the IRS, some may assume that taxpayers should either submit and pay or wait to not pay at all. Experts say think twice before listening to that advice.
Have you not filed your taxes yet?
There is less than 24 hours before the tax deadline on April 15th and you will have time to file your 2024 federal tax return or request an extension. It may also be your last chance to request a refund on the previous year’s returns.
A survey of more than 1,000 US tax returners for IPX1031, an investment property exchange service, shows that nearly a third of Americans are allowed to postpone tax filings. The survey shows that about 25% feel they are not ready to file taxes.
“Procrastination is a natural response when something feels overwhelming,” says Erika Wasserman, CEO of your financial therapist. “But delaying important tasks like filing taxes only complicates stress.”
On the other hand, some people may assume that taxpayers should either submit and wait for them to pay or not pay at all given the cuts in staffing at Internal Revenue Service. Think carefully before keeping that advice in mind, experts warn.
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“Beyond the fact that applications and payments are law, compliance activities of many institutions are actually rather routine, matching W-2s and 1099s that match what was reported on tax returns, generating tax valuations, various delays, postponements, and valuing estimated tax penalties.”
However, most taxpayers have already filed federal tax returns.
As of April 4, the IRS received approximately 110 million individual returns of 160 million people who had anticipated this filing season, the agency’s latest report shows. Approximately 68 million refunds have been issued, with the average refund amount at $3,116, an increase of about 3.5% over a year ago.
Submitting an extension
For most taxpayers, the federal tax deadline is April 15th. If you are short on tax documents or need more time, you can file a tax extension by April 15th.
If you select “Extensions” when making electronic payments on the IRS website in 2024, you will automatically submit Form 4868, the document you need to request the extension.
“As we’re currently in progress with all the check theft and check washing schemes, e-pay is a great option. Plus, you’ll get the peace of mind of knowing right away that the IRS has got your payment,” Smith said.
(Check washing is a form of check scam in which a thief steals a check, erases the original recipient and amount, and then rewrites the check for his or her own interest.)
Payment options, including IRS Direct Pay, are available at irs.gov/payments.
You can also mail the Extended Form 4868 by April 15th to include a check on what you are borrowing, but processing times may be longer.
Even if you are unable to pay your tax balance by April 15th, you will still need to file a return to avoid an IRS penalty, experts say.
File penalty failures are 5% or partial months of outstanding taxes per month capped at 25%. On the other hand, payment disability is 0.5% of monthly taxes, limited to 25%. Interest will be charged on both penalties. This is currently 7% of individuals.
Disaster relief for tax returners
Taxpayers in many disaster areas automatically submit and pay more time, and don’t even need to ask for extra time.
Some states of Alabama, Florida, Georgia, North Carolina, South Carolina, Alaska, New Mexico, Tennessee and Virginia must file and pay until May 1st. Due to a wildfire, Los Angeles County will have to file and pay until October 15th. Parts of Kentucky and West Virginia must submit and pay until November 3rd.
Taxpayers can find more details at IRS.GOV/DisasterRelief.
Files for unsolicited refunds
If you have a refund for your 2021 tax year billing amount, the IRS says you must file it now before the three-year time window ends on April 15th.
“For many people, doing this is more important than ever, partly because of the pandemic, many of the tax benefits of 2021 taxes have been expanded, including stimulus-related recovery rebate credits, child tax credits, credits for child dependency costs, and earnings income tax credits,” Smith said.
“Most of the expanded profits were refundable, making them particularly advantageous for low- and medium-income earners and families.”
If you’re not sure if you’ve received your money, there’s a simple way to check your IRS account online, says tax experts.
In 2021, the stimulus amount was worth up to $1,400 per individual or $2,800 per couple. A family of four can receive up to $5,600 for two eligible dependents.
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