Updated on Friday October 9, 2020: Tax payers who filed for extension to file 2020 tax returns have roughly a week to complete it and avoid penalties and any potential interest fees. This year the tax season has been relatively long as the original deadline of April 15 was extended to July 15 as a result of the pandemic.
Anyone who still hasn’t filed tax returns should consider the following:
- You may qualify for a refund –efiling is the fastest, easiest and most accurate way to file taxes; additionally, you see the refund amount as you progress through the tax return
- Do you own money to the government – if you suspect that you owe taxes, you may consider filing timely to avoid potential penalties and interest fees; the IRS often recommends to make even the smallest payment, which may minimize the penalties
- If making tax payments presents a challenge at the moment, there are options available
- Apply for a payment plan and make monthly payments based on how much you can afford
- Offer in compromise – you can settle your debt with the IRS for less than a full amount; this option is not automatic and not everyone may qualify
- Delay collection – submit a request to temporarily halt the collections of your debt and postpone it until your financial situation improves
Electronic filing is not available after October 15. It makes a great difference to file electronically, or efile, as the time to receive a refund takes on average 21 days. In the meantime, you have an option to check the status of the refund daily, i.e. whether or not it’s been issued. One thing I like about the efiling is an electronic confirmation that a tax return was submitted and received.
Efiling is available though multiple electronic filing platforms. IRS entered into a partnership with the commercial tax preparation software companies to allow certain taxpayers to file taxes for free, or Free File. In a recent article, the IRS noted that this year more than 4 million taxpayers were able to file for free. This marks a significant increase from the prior year when 2.7 million taxpayers managed to file for free.
The main determinant to qualify to Free File is the income level and complexity of the tax return. To learn more about Free File, click here.
If interested, there is a brief questionnaire to determine, which of the free services are available to you. You need to provide the following information: Filing Status, Age, Adjusted Gross Income (AGI) estimate, EITC, State of Residence, and any Military Pay. The results display available offers to file your taxes for free. To access this Lookup Tool, click here.