What If I Cannot Pay My Taxes On Time

It’s tax time but what while preparing your return you ask yourself, What if I cannot pay my taxes on time? Taxpayers who can’t pay in full should submit their return on time and pay as much as they can. This helps avoid penalties and interest charges. If they still owe a balance after submitting their tax return, they can request an installment agreement online or call 1-800-TAX-1040 to arrange to pay by debit or credit card. Following any of these steps helps taxpayers avoid late filing penalties, interest charges and the possibility of identity theft.

What If I Cannot Pay My Taxes On Time
What If I Cannot Pay My Taxes On Time

One Option is to Obtain a Loan

Most taxpayers can get a loan at a bank or credit union. If you owe $50,000 or less in taxes, are employed and earn income, you can get an installment agreement for up to 72 months.

Payment Plans

The IRS offers payment options to help eligible taxpayers pay their taxes in four easy installments. The IRS also allows taxpayers to spread payments over four installments using the tax bill calculator tool on IRS.gov. Checks, money orders, debit cards, and credit cards are all acceptable forms of payment. You may be able to pay electronically using a bank account or prepaid debit card and IRS Direct Pay.

Ask For a Delayed Time to Pay

If you need more time to pay, the IRS may be able to delay collection until your financial condition improves. However, penalties and interest continue to accrue. Taxpayers can request a postponement by calling the number listed on their notice or 1-800-829-1040.

Dismissal of Penalties

The IRS has several methods to assist taxpayers who are experiencing financial difficulty. Taxpayers who can’t pay in full today may be eligible for a short-term solution, such as an installment agreement or an offer in compromise. In certain situations, the IRS can lower a taxpayer’s penalty amount by using penalty abatement or elimination programs. Taxpayers whose tax debts have been previously rejected by the IRS can participate in the First Time Abatement program.

The Taxpayer Advocate Service’s (TAS) Taxpayer Assistance Order (TAO) program provides options for taxpayers to pay their tax bill by reducing or eliminating the late-filing or late-payment penalties. If applicable, taxpayers should be able to determine if they are due penalty abatement on the IRS.gov web site. Penalties that apply to a specific tax year may be paid by credit card through IRS.gov by entering the amount owed and selecting the “Pay Online” button when accessing the appropriate page.

Offer in Compromise

Before deciding to pay your taxes in full, you may be able to settle them for less through an Offer in Compromise. For example, offers may be accepted for valid concerns about the taxpayer’s ability to pay. Individuals interested in applying can use the Offer in Compromise Pre-Qualifier tool to determine their eligibility. We would be happy to work with you to review your options and explain more about how an offer could help.

If You Can’t Pay The IRS – Here’s What You Need to Know.

TurboTax Helps Users Get More Accurate Tax Returns

TurboTax Accurate Tax Returns

Each year, Americans are forced to go through last year’s financial information and prepare a tax return.  For some people, this is a happy time because they will be getting a tax refund, which can mean several thousand dollars in their bank account.  But for others, they will own more money to the Internal Revenue Service.

Day 093/365 - Tax Time Phat Cash!
Day 093/365 – Tax Time Phat Cash! (Photo credit: Great Beyond)

The Internal Revenue Service can not look at every single tax return because there are simply too many filed each year.  They do audit some returns, but it is only equal to one percent of all tax returns.  Most people will never have to worry about being audited by the IRS in their life time.  People cheat on their taxes to avoid paying more taxes each year or to try to get a bigger refund from the government.

The good news is that the majority of people do not cheat on their taxes.  Perhaps this peer pressure will deter other people from cheat on theirs.

Recently, the IRS Oversight board conducted a telephone survey that found that 87 percent of Americans felt that is is not acceptable to cheat on your taxes.  The main reason they were against cheating on taxes is due to personal integrity and not the possible punishment.  Just over 10 percent of people polled said it was acceptable to cheat a little bit on their taxes.

Some people cheat on their taxes without even realizing it.  They may omit important financial information or deduct something that should not be deducted.  These errors are not made intentionally, but they can mean big trouble if they get caught.

Using free Turbo Tax 2013 can help people prepare their taxes and increase the odds that their taxes will be accurate.

Sometimes an error or omission helps the individual by reducing the amount of tax they owe.  But sometimes it helps the government by raising their tax amount.  When this happens, you may not get as big of a refund as you normally would.

TurboTax is an easy to use program that many people use by themselves without hiring a tax professional.  It is less expensive than hiring a tax preparer, and you can use it at any time.

The computer program walks users through each step of preparing their taxes.  It asks questions and offers advice for every item that you need to enter, and it makes it easy for users to file their taxes.

Not only can free Turbo Tax 2013 help make your tax return more accurate, but it can also increase your refund.  Some people find they are eligible for more tax credits if they use a program to help them prepare their return.  When your tax return is accurate, you reduce the risk of an Internal Revenue Service audit.

Tax Credits For Your Home

2010 Tax Credits For Your Home

For those of you thinking of buying a new home but are not sure about the 2010 tax credits, maybe this will help you. If you are buying a home and your modified gross income is less than $245,000, the house costs less than $800,000, and you’re a first time home buyer, you can receive full credit. If your modified adjusted income is more than $125,000, you will receive a reduced credit. If your MAI is more than $245,000, you will receive no credit. Also, for those of you who are remodeling, you can also receive tax credits for your home.

2010 Guide To Home Buying Tax Credits

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How Tax Law Changes Change Your Life

Tax law changes tend to happen at least once a year. An obscure loophole may be closed, or the tax rate on a specific type of profit may be increased or decreased. In either case, it is important to make sure that you have the right income tax advice before dealing with your own taxes. Rather than trying to go it alone, the help of a professional can aid you in making sure that all your forms are filled out correctly and that all the correct deductions have been made. Even with this in mind, though, you may still wonder if tax changes will actually have any bearing on your own situation.

Now, the truth of the matter is that most tax law changes will not actually do much to change the tax returns of most individuals. The bulk of the changes in any given year will only actually cause an effect on the taxes of a select few, but you may never actually know that these changes have gone into effect unless you actually consult with a tax professional. Unfortunately, lack of knowledge about these changes is no excuse when you file, and if you are audited you may actually face rather stiff penalties for failing to adhere to laws that were only recently passed.

There are, of course, many tax law changes that will cause major changes for more tax payers. The IRS is generally quite vocal in announcing these changes, and most are incorporated into even simple tax return programs. However, if you need to feel reassured about what effect these changes will have on your taxes or you simply wish to play it safe, it may be wise to seek out professional income tax advice. It may cost a bit more, but the associated costs are nothing when compared to the fines that may be incurred by those that file incorrectly.

The author has spent a lot of time learning about tax law changes and other related topics. Read more about income tax advice at the author’s website.