If you’re making an income, chances are that you have a lot of work cut out for you when it comes to your taxes. From tax credits to deadlines and extensions, there’s a lot to take into account. First things first, find out when you want to get your taxes in—there’s a deadline. Then, find out all you can about extensions, etc. Here are some things to keep in mind with tax deadlines and extensions:
First tax deadline
One of the first things to consider when preparing your taxes is to keep the tax deadline in mind. There is the initial key deadline that you do want to do your best to meet. It’s when your payment is due and is the time you should be filing.
April 15th is when you should already have your individual tax return filed. You should also make your estimated tax payment on that date so that you can avoid any issues with penalties or interest associated with late IRS payments. With tax business software, it can be easier to file your tax return and know how much you owe.
Extension deadline
So, let’s say that for whatever reason, you need to wait on filing your return. Your due date for filing your return will be October 15th of this year. There is the Form 4868 that you can file or if needed for a business, you will want to use the Form 7004.
Keep in mind that if you don’t file for an extension and miss the first tax deadline, you could be subject to some penalties. And even if you aren’t quite sure what you owe, if you’re a self-employed individual, you should still make an estimated payment by April 15th.
If you don’t have enough money
Let’s say that you don’t have quite enough saved for taxes. If this is the case, you’ll want to set up a payment plan/installment agreement with the IRS. While there will be different amounts that you can ask to pay that can suit your budget, it is helpful to pay as much as possible on a monthly basis, so that your payments are paid off quickly. Keep in mind that if your payments go over the time provided, you could end with heavy interest payments which could make it difficult for you to pay off your tax debt.
When you’re self-employed…
While most people who are working with a W2 get their taxes taken out, for independent contractors and self-employed individuals, it’s your responsibility to make your tax payments. Estimated quarterly payments will help you to avoid any penalties and take care of your responsibility so that when it’s time to file your return, you’re not subject to penalties. Using a form known as Form 1040-ES, you can estimate how much is owed, so that you’re not underpaying.
Get professional help
It’s a well-known fact that doing your taxes correctly isn’t always easy. So, with this in mind, think about working with a professional who can simplify the process for you. The last thing that you want to do is to mess up on your return, as this can have repercussions down the road—and expensive ones too.
While a professional does mean paying some money for their help, it’s worth the money that can be saved. Ask friends or acquaintances if they have any recommendations so that you can be confident that you’re making the best decision when it comes to filing your taxes.
In Conclusion
Taxes aren’t an easy part of life, but they are a part of any employed individual’s life. They can certainly be overwhelming, as well. So, when in doubt, ask a professional tax accountant to help.