Your Tax Toolbox

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Time to file tax returns is running out with only hours left to go. Here are some topics to consider and make quick decisions on what to do next to ensure we are complying with the government regulations.

Do I have to file taxes?

If you worked in 2017, you do have to file taxes. There is sometimes a misconception that filing taxes will force us to pay into the system, but it’s not always the case. For once, you might not have made that much and the employers automatically withhold portion of your wages as taxes. That is the contribution that you make throughout the year. Applying common credits and deductions can reduce your tax bill and the outcome can result in a refund.
Remember that we are legally obliged to file tax returns. If we owe the government and not file tax returns, we may be charged penalties.

Finally, when we pay taxes we also contribute to our future social security and Medicare. The amounts we report make impact down the road and will impact what we can expect to receive when we are most vulnerable – during the retirement.

Can I file taxes for free?

The short answer is yes, but this depends on how much you earned in 2017 and how complex your tax situation is. You can file taxes for free using the tax filing software offered by the biggest companies on the market, such as TurboTax, H&R Block, TaxAct, or TaxSlayer, just to name a few. To determine whether or not you can file for free, check out IRS’s FreeFile.

Where’s my refund?

When you file your taxes and expect a refund, there is a very handy tool to check where your money is. IRS developed Where’sMyRefund tool that updates every day with the latest information. It is most efficient when you file taxes electronically because the information on the refund could be available as soon as 24 hours after efiling. In comparison, if you mail your return, it may take up to 4 weeks to have the refund information available.

To check the status of your refund, you will need to provide the following information:

– Social security number.
– Your filing status.
– The amount of federal refund you’re expecting.

Running out of time

Not everyone will beat this year’s tax filing deadline. That’s not the reason to panic though. For once, if you expect to get a refund, you will just get it later. If you don’t file, you don’t get it. If you suspect that you owe taxes, not filing isn’t the best solution. The government can still find ways get their share so you should manage your affairs with minimum negative impact. The best thing to do is to file an extension to submit tax returns. You will get an automatic six months extension and will have until mid October to get it done. By filing for extension you avoid late filing penalties. The extension does not shield you from late payment and interest on the amount of taxes you owe. File and submit Form 4868 electronically for automatic extension. Make sure to file the form before April 17 and you will have until October 15, 2018 to get the taxes done.

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