The deadline for filing your federal tax return is about two weeks away. If you haven�t filed your tax return yet, you�re not alone. During the last few weeks of the tax filing season, the IRS expects to receive about 101,700 returns and 22,300 extension requests from South Dakotans. Here are some tips to avoid stress at the eleventh hour and help beat the crush of the April 18th deadline.
Prepare Now and Avoid Common Errors�Make sure you have all the documents you need to file your tax return. Gather together your Forms W-2 (earnings statements) and 1099 (interest/dividend statements). If you own a home, you will need Form 1098 to get the amount of mortgage interest you paid. If you itemize, make sure you have the receipts for all your deductions such as charitable donations and medical expenses. You will also need a Social Security number (SSN) for yourself, spouse and any dependents listed on the return. If you don�t e-file, check all math and data entries�including SSNs�to ensure they are correct and legible. Inaccurate or missing information could delay your refund.
File Electronically � Even If You Owe�There�s no need to hold on to your return because you owe money. You can file electronically now and set your automatic payment for April 18th. You can e-file using the IRS Free File program, through a tax preparer or using a personal computer and tax preparation software. E-filing has many benefits. It offers faster refunds, more accurate returns, paperless filing, and confirmation within 48 hours that IRS has accepted your tax return. If your 2010 adjusted gross income was $58,000 or less, you can prepare and e-file your federal tax return for free through the IRS Free File program. To Free File, go to the IRS Web site at www.IRS.gov, click on Free File and select a software company that meets your needs. Remember, you must access all Free File software companies through the IRS Web site.
Don't Miss Tax Credits for Workers� Taxpayers who worked any part of 2010 and whose household income was less than $48,362 may be eligible for the Earned Income Tax Credit (EITC). The maximum credit is $5,666. Individual credit amounts are based on filing status, income and number of qualifying children. Four out of five eligible workers claim and get EITC, but the IRS would like to make that five out of five. The EITC Assistant on the IRS Web site at www.IRS.gov can help you determine if you are qualified. Also, be sure to fill out Schedule M with your tax return to see if you qualify for the Making Work Pay Tax Credit.
Need Additional Time? File for an Extension�Need more time to file your 2010 tax return? Request an extension and get an additional six months�until October 17th�to file your tax return. To request an extension, you must file Form 4868 with the IRS. It can be mailed or e-filed. All extension requests must be filed no later than April 18, 2011. Form 4868 is available on the IRS Web site at www.IRS.gov.
File Your Tax Return by April 18 Even If You Can�t Pay�If you owe money and can�t pay, you should file your return timely (by April 18) to avoid the late filing penalty. The late filing penalty (at five percent per month with a maximum of 25 percent) is 10 times greater than the late payment penalty. Paying as much as you can with your return will help reduce interest and penalty charges. You can then request to pay the remaining balance in monthly installments.
Pay Taxes Due in Monthly Installments�You can request to pay any taxes due in monthly installments by submitting Form 9465, Installment Agreement Request, with your return or when you get a notice from the IRS. Also, you have the option of using the IRS Online Payment Agreement application on the IRS Web site at www.IRS.gov. List the amount you propose to pay each month. The IRS will let you know if the request was accepted. There is a one-time $105 fee for entering into an installment agreement. That fee is dropped to $52 when payments are deducted directly from your bank account.
File Past Due Returns to Avoid Losing Refunds�Nearly 2,000 South Dakotans have not yet filed a tax return for 2007 and are missing out on more than $1.9 million in unclaimed refunds. To collect these refunds, 2007 tax returns must be filed with the IRS no later than April 18, 2011. Half of these unclaimed refunds would be for more than $635.
Check Your Refund Status Online�Visit IRS.gov and use the �Where�s My Refund� program to find out the status of your refund. Or, get the new IRS free phone application for iPhones and Androids. Using the IRS2Go app, you can check on your refund and get tax tips.
Get Tax Help or Forms�The IRS has several options available for tax help and forms. Go to the IRS Web site at www.IRS.gov to get tax forms and publications as well as tax information. Toll-free telephone assistance is available by calling the IRS at 1-800-829-1040. Get free tax help at volunteer income tax assistance sites located throughout South Dakota. Check IRS.gov or call 1-800-906-9887 for volunteer tax assistance site locations. Help is also available at IRS Taxpayer Assistance Centers. Check out the IRS Web site at IRS.gov for IRS office locations and hours.