What To Do If I Owe Taxes – If taxpayers are unable to file their taxes by Monday, they can request an extension until October 15.
WASHINGTON — Americans have until Monday, May 17 to file their 2020 income taxes with the Internal Revenue Service.
What To Do If I Owe Taxes
The IRS extended the deadline from April 15 to May 17 to give taxpayers and the IRS more breathing room to deal with changes brought on by the coronavirus pandemic. If taxpayers are unable to file their taxes by Monday, they can request an extension until October 15.
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“The IRS wants to continue to do everything it can to help taxpayers cope with the unusual circumstances associated with the pandemic, while also fulfilling important tax administration responsibilities,” the commissioner said. of the IRS, Chuck Rettig, in a statement in March, when the tax filing deadline was extended. .
Taxpayers will face penalties and interest if they fail to file their tax returns by the May 17 deadline.
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The IRS says individuals who need additional time to file their return beyond May 17 can request an extension of their return until October 15 by filing Form 4868 through a tax professional, tax software, or by using the “Free File” tool on the IRS website.
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However, the IRS said that filing Form 4868 gives taxpayers until October 15 to file their 2020 tax returns, but does not grant an extension of the deadline to file their taxes. Taxpayers must pay federal income tax by May 17, 2021 to avoid interest and penalties.
In March, the IRS announced that the traditional tax filing deadline would be moved from April 15 to May 17.
The decision to extend the deadline comes after an intense year for the chronically underfunded IRS. The pandemic hit in the middle of last year’s tax filing season, setting institutions back in terms of processing. The IRS also played a key role in providing government relief payments and is now helping deliver the third round of payments in the middle of the current tax filing season.
Additionally, the extension gives the IRS time to issue guidance on new tax law changes. The American Rescue Plan exempts $10,200 of early unemployment benefits from federal taxes for those earning less than $150,000.
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Earlier this year, following a disaster declaration issued by the Federal Emergency Management Agency (FEMA), the IRS announced relief for victims of February’s winter storms in Texas, Oklahoma and Louisiana .
These countries have until June 15, 2021 to file various personal and business tax returns and pay their taxes. This extension until May 17 does not affect the June deadline. Click here to learn more about IRS disaster relief.
The IRS offers the FreeFile tool allowing taxpayers to file their tax returns electronically. IRS Free File offers branded tax software for taxpayers with income of $72,000 or less in 2020. More taxpayers can use Free File Fillable Forms, an electronic version of IRS paper forms. The tool also allows taxpayers to obtain an automatic extension of the declaration deadline if they need it.
Free File Tool is also a way to get fast refunds. Electronic deposit and direct deposit are the fastest and most accurate way to file and get your refund. The IRS issues nine out of 10 refunds in 21 days or less. Taxpayers who file their returns on paper can also choose direct deposit, but paper returns take longer to process.
Tax Returns Due May 17: Last Day To File Taxes Without Penalty
The IRS said it will take more than 21 days to issue refunds for certain 2020 tax returns that require a review to include an incorrect refund credit amount, or that use 2019 income to calculate the refund credit. Earned Income Tax (EITC) and the Additional Child Tax Credit. (ACTC). ).
By extending the deadline to file the Series 1040 return to May 17, the IRS has automatically postponed the date individuals can contribute in 2020 to individual retirement (IRA and Roth IRA), health savings accounts (HSA), Archer Medical Savings Accounts (Archer MSA) and Coverdell Education Savings Accounts (Coverdell ESA).
For the 2017 tax year, the normal April 15 deadline to request a refund has also been extended to May 17, 2021. The law provides a three-year window to request a refund. If the taxpayer does not file a return within three years, the money becomes the property of the U.S. Treasury.
The law requires taxpayers to properly address and mail their tax returns and ensure their tax returns are postmarked by May 17, 2021. Additionally, foreign trusts and estates with federal tax returns or payment obligations , who file Form 1040-NR, now have until May 17, 2021. 2021. However, it is important to understand that you are not without options. This article explores practical steps you can take to resolve and resolve your back tax situation, ensuring you can tackle these challenges with confidence and clarity.
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Start by gathering all relevant documentation to understand how much you owe and the years. Review your IRS notice and if anything is unclear, consider contacting the IRS for a detailed explanation. Knowing exactly where you stand is the first step toward resolution.
Effective communication with the IRS is an essential step for anyone facing back taxes. It’s natural to be anxious about reaching out, but taking proactive steps can significantly improve your situation. The IRS is more accommodating than many taxpayers think, especially for those who are willing to settle unpaid taxes. Here are some tips for effective communication:
Remember, the purpose of communicating with the IRS is to find a path forward. With a clear understanding of your situation and a willingness to work on a solution, you can file your taxes efficiently.
Understanding the different payment options available through the IRS can allow you to make informed decisions about how to resolve your back taxes. Each option has its own advantages and disadvantages, suited to different financial situations. Here’s a closer look:
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An installment agreement allows you to pay your tax debt over time in monthly installments. This is an accessible option if you cannot afford to pay a lump sum.
This program allows you to settle your tax debt for less than the amount owed if paying your tax obligation in full results in financial hardship.
If you can prove that paying your back taxes will prevent you from meeting basic living expenses, you may qualify for current non-collection status, which temporarily stops collection efforts.
When filing taxes becomes tedious, it is important to have experienced professionals on your side. Our team specializes in helping individuals meet their tax obligations and take advantage of programs like the IRS Fresh Start Initiative. With our expertise in tax law and IRS procedures, we can guide you through the process of reducing, resolving or even eliminating your back taxes. Let us help you take control of your financial future by exploring all the options available for your unique situation.
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If part of your debts relate to unfiled tax returns, it’s important to get current. Filing delinquent returns can reduce penalties and interest, and is often a necessary step before the IRS considers a payment plan or settlement offer.
Once you’ve resolved your current tax filing problem, take proactive steps to avoid future problems. This can include adjusting your withholding taxes, paying estimated taxes if you’re self-employed, and ensuring you file your taxes on time every year.
Having to pay back taxes to the IRS can be stressful, but taking proactive steps and using available resources can lead to a resolution. By understanding your situation, communicating with the IRS, exploring payment options, and possibly seeking professional help, you can more easily navigate this process and get back on your financial footing.
If you owe back taxes or have a problem with the IRS, click here or call us directly at (877) 542-0412. When it’s tax season, we all want to maximize our tax refund. The first step to achieving this is understanding the tax return. Filing taxes can seem like an overwhelming task, but with the right knowledge, the process can be smooth. From understanding the different types of tax forms to knowing what deductions you’re eligible for, there are a few things you need to know to file your taxes efficiently.
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1. Types of Tax Forms: There are several types of tax forms, but the most common are the 1040, 1040A, and 1040EZ. The form you choose to fill out depends on your income, deductions and credits. For example, if your tax situation is simple and you don’t benefit from many deductions, Form 1040EZ may be the best option for you.
2. Tax deductions: Tax deductions can help reduce your taxable income and increase your tax refund. Some common tax deductions include charitable donations, mortgage interest, and medical expenses. To take advantage of this deduction, you must track your expenses throughout the year and make sure you have the necessary documents to support your claim.
3. tax credits: tax credits are distinguished from deductions in that they directly reduce the amount
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