The Internal Revenue Service (IRS) is making it easier and quicker for citizens that are behind in filings and taxes owing. Tax-filing extensions are available to taxpayers who need more time to finish their returns if they make this request before the April deadlines of each year.
Taxpayers can request a 6 month extension if done so before this deadline and can even request additional extensions within the 6 month period as well. This relief can easily be done online at the IRS website. In a matter of minutes, anyone, regardless of income, can use this free service to electronically request an automatic tax-filing extension on Form 4868.
By properly filing this form, a taxpayer will avoid the late-filing penalty, which is about five percent per month based on the unpaid balance. This applies to tax returns filed after the deadline. Additionally, payments made during a requested extension will reduce or eliminate interest and late-payment penalties that apply to payments made after April 17.
Certain types of Taxpayers automatically get extensions to file and they are: Taxpayers living abroad, Members of the military and others serving in Iraq, Afghanistan or other combat zones localities and people that are affected by certain tornadoes, severe storms, floods and other recent natural disasters.
Taxpayers that cannot pay their taxes may qualify for one of several relief programs, including those recently expanded under the IRS Ã¢â‚¬Å“Fresh StartÃ¢â‚¬ initiative, which include:
Those who owe $50,000 or less in combined tax, penalties and interest can use the Online Payment Agreement to set up a monthly payment agreement for up to six years.
Most unemployed filers and self-employed individuals whose business income dropped substantially can apply for a six-month extension of time to pay.
Some struggling taxpayers may qualify for an offer-in-compromise. This is an agreement between a taxpayer and the IRS that settles the taxpayerâ€˜s tax liabilities for less than the full amount owed.
According to the IRS they are expected to receive over 144 million personal tax returns for 2011.
When Taxpayers file their returns they qualify for the many tax deductions and through the various federal and state government programs. By not filings, they miss out on thousands of dollars in possible rebates. One important note to keep in mind, is to inform the IRS of any address changes that you may have to make sure you get your refund in a timely basis.
There are more than $1.1 billion of refunds that are unclaimed from the Internal Revenue Service. All that a taxpayer has to do is called the IRS or check online for the status of their refund and make a claim for it. Ã¢â‚¬Å“This new found money could be a great way to help many individuals pay done some debtÃ¢â‚¬ says Edward Palonek, who is the founder of an online unclaimed money search service called foundmoney.com, which specializes in providing information on the whereabouts of unclaimed and forgotten money.
Even if you may owe some taxes the following years, a taxpayer can use the refund to offset these amounts. Taxpayers can even use the unclaimed refund to offset unpaid child support or past due federal debts such as student loans.
Ã¢â‚¬Å“In difficult times like these, every dollar counts so make sure to maximize your refund and make a claim for that money that rightfully belongs to youÃ¢â‚¬, says Palonek.
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