The final days of the 2016 tax season are upon us, and that means if you haven’t already filed your taxes you have just a few more days left. Sandy Furuya, Senior Accounting Manager at Wamhoff Financial Planning & Accounting Services, answers last minute questions you may have.
What is the deadline this year to file taxes?
- While the deadline to file taxes is typically April 15th, this year we have a few more days due to Emancipation Day, which is a federal holiday that happens to fall on April 15th. So the deadline this year is Monday, April 18th.
- There is an extension for those individuals and businesses affected by the December flooding. This includes a number of counties here in the local area, including St. Charles, St. Louis. Filing and penalty relief is provided to any taxpayer with an IRS address of record located in the disaster area. The deadline for those affected by the flooding is May 16th.
- If you were affected by the floods, you do not need to contact the IRS to get the extension, as it’s based on your address. However, if you do receive a late filing or payment penalty notice, call the number on the notice and the penalty will be abated.
What happens if I don’t file?
- If you do not file your tax return, you will be charged a penalty for failure to file.
- If you need more time to file, then file an extension. You can file an extension through the IRS.gov website, or by using form 4868.
- An extension doesn’t give you more time to pay, however. You must still estimate and pay what you owe by April 18th to avoid penalties and interest.
What happens if I can’t pay my taxes?
- File your return even if you cannot pay. This will avoid a penalty for failure to file.
- Pay as much as you can to avoid penalties and interest.
- Contact the IRS as soon as possible to discuss payment options at 800-829-1040. There are several payment arrangements which you can work out with the IRS.
- Short-term payment arrangements can be made for up to 120 days. There is no user fee for this extension, but interest and penalties will continue to accrue.
- Long-term arrangements are available through an Installment Agreement, which can be requested by completing Form 9465. There is a one-time user fee of $120, or $52 if you choose to pay through direct debit from your bank account.
- In some cases, the IRS may be able to waive penalties.
- Respond to all IRS notices you receive. The IRS is willing to work with you, but you can’t delay in communicating with them.
- Finally, you’ll want to ensure that the tax liability does not reoccur. It could have been a one-time occurrence, but if not, adjust your withholdings.