Updated on July 15, 2020: COVID-19 has monopolized the news stories over the last few months. As a direct impact of its outbreak, the IRS automatically extended the deadline to file tax returns from April 15 to July 15. It is easy to imagine that preparing to file the income tax returns may not have been the number one priority of many taxpayers.
Here are some things to consider as the filing deadline has arrived:
- Freefile is available to taxpayers whose income is less than $69,000. The IRS website provides the list of all the commercial tax software that allows those who qualify to file federal taxes for free.
- Getting help and answers to tax questions has been difficult lately. To see the IRS staff in person make sure to visit irs.gov to make an appointment, if available, as the offices typically don’t allow walk-ins. For last minute tax help, try Interactive Tax Assistant (ITA). Pick a topic or type a question you have, and follow the ITA’s process of fine-tuning your question to get the answer you’re looking for.
- If you still need more time to take care of your taxes, you can file an extension until October 15. The form must be filed by 7/15/20. One simple way to do it is by filing Form 4846. You can do that by starting your tax return – try freefile to make it simpler – and select the extension. The extensions are granted automatically, but remember that getting your extension approved does not equal extension to pay. If you owe taxes, you are still liable to make a payment. By postponing that, you risk paying interest fees and penalties. One way to mitigate that is by making even a small payment, whatever you can afford at the moment (see the links below).
- Filing taxes electronically is the fastest way to complete the whole process. The IRS has reported delays in processing paper tax returns due to current understaffing. This means that it may take longer to get your refund back, or even an acknowledgement of the return being processed. Additionally, if there are any errors or corrections that need to be made, the entire process can drag for a long time. E-filing taxes is swift and 9 out of 10 taxpayers receive their refund in 21 days or earlier.
Here’s how to make payments if you owe money to the IRS:
- Paying Your Taxes – you can schedule a bank transfer, also known as Direct Pay, or pay with a credit or debit card. Credit and debit card payments typically have fees as they are handled by the third parties.
- The Electronic Federal Tax Payment System (EFTPS) – allows you to make your federal tax payments.
- Installment agreement – this option lets you apply for an installment payment based on your specific situation. The response to your application should be automatic. The IRS offers short- and long-term payment plans.