While every taxpayer’s experience is unique, the length of any tax filing situation depends on specific financial circumstances and the means in which a taxpayer chooses to file. If funds are tight when you file, you may be able to qualify for a payment plan with the IRS. “That way, you don’t face any IRS “Failure to Pay Penalties” violations,” said Brian Hershman, founder of BSH (Buck Stops Here) Accounting in San Diego. You should also be ready to pay any projected tax liability. “Filing early in the season allows for the completion of a tax return to be as stress free as possible.” “When you’re racing the clock, you’re at a higher risk for typos, inputting inaccurate numbers or overlooking a mistake,” Jaeger added. Having the stress of beating the deadline when you’re down to the wire is not fun for most people. And for others who owe, it allows for more time to make a plan for payment.” “For many, it will allow them faster access to their refund. “It’s always in a filer’s best interest to file as early as possible,” Jaeger said. “It’s likely in your best interest to adhere to those instructions to avoid processing delays,” said Mark Jaeger, vice president of Tax Operations at TaxAct, in Cedar Rapids, Ia.Įarly in 2023, you may have been advised to hold off on filing your taxes if you had an account at crypto hedge fund FTX, which filed for Chapter 11 bankruptcy amid fraud charges from the U.S. There is no penalty for filing an extension, so it’s a no-brainer,” said Persichitte.Īdditionally, if the IRS gives any type of recommendation or guidance about filing your return - for example, if they say to hold off for some reason, hold off on your tax filing. “Request that as soon as possible, and if you’re going to come closer to the deadline, file an extension right away. For example, the IRS 1099-B form that shows income from brokerage accounts is typically due only in March. By law, not all tax forms are required to reach you by Jan. “You should wait if you are missing information,” said Persichitte. Waiting to file tax returns until the last minute is typically highly inadvisable, yet, in some rare scenarios, it’s okay - maybe even encouraged. “That means she had to add back almost $20,000 of income in 2021 and she will have to claim the distribution as income when she takes it out of the account,” Persichitte said. That year, taxpayers faced doubled taxes on any over-the-limit contributions. She tried calling both banks, but they were too busy to process the distribution request on the same day. “You only have until April 15 to correct the mistake. “She maxed out her 401(k) at both jobs, which is not allowed,” Persichitte said. “ waited until Friday, April 15 to get her information to me.” “Last year, taxes were due Monday, April 18,” said Robert Persichitte, CPA at Delagify Financial in Arvada, Col. In general, procrastinating on your taxes provides you less time to maneuver your finances and correct mistakes, which can have huge financial repercussions. Internal Revenue Service (IRS) shows that over 13.5% more taxpayers have filed their returns by Februcompared to the same period in 2022, when the IRS had received 16,685,000 federal tax returns.įiling early can mean faster tax refunds, extra time to pay any taxes owed and less deadline stress to deal with. Americans are skipping the usual filing procrastination with their tax returns this year.ĭata from the U.S.
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