There are only a few days left until one of my favorite days of the year: Tax Day! With this year's deadline on April 17, 2012, last-minute tax filers have two extra days to submit their 2011 tax returns. Even though the majority of taxpayers have already filed, there are still millions who will file in these final hours. If you are filing in these final days before the deadline, keeping the following tips in mind may make the process easier and may help you avoid making some common mistakes. The key takeaway is that even if you are reading this article on the last day, there is still time to get your taxes done correctly with the biggest refund, or lowest tax liability, possible.
My first tip is that technology is your friend -- even when it comes to taxes. Taxes today are simply too complex, with too many rules and considerations to be left to paper forms and manual computations. Whether using a tax professional or doing your taxes yourself, make sure current tax software, computer technology, and available online resources are being used. With regard to online resources, the good news is that there are many available now from the Internal Revenue Service (IRS), tax preparation companies, and other resources, from finding a local professional in your area through a zip code search, to letting you prepare and file your taxes online from your own home. There are also online tools to help you determine and organize what you need to file a return, to estimate your tax refund or balance due, and even to let you track your refund status after you have filed.
As time runs out on the filing deadline, it is important to make sure that you consider all tax benefits available to you, so that you do not leave money on the table. There are literally thousands of tax credits, deductions, and benefits available, but you need to know where to look to claim them. Take some time to think about changes in your life that occurred during 2011. Did you start to care for an elderly parent as a dependent? Did you take a new job? Did you buy a home? All of these situations -- and many others -- can add up to more dollars on a tax refund, if you are eligible.
When it comes time to actually file your tax return, be sure to do what almost 80 percent of taxpayers now do: electronically file your tax return, regardless of whether you self-prepare or use a professional preparer. But remember, "e-filing" (IRS e-file) is not simply preparing your tax return on a computer. It means actually sending your tax return to the IRS electronically. With time running out, not only is e-filing faster than mailing a paper return, but it's also more accurate and includes a confirmation from the IRS that your return has been received. Plus, you can get your refund in as little as eight to 15 days when combining e-filing with direct deposit. It's a win-win situation, and it is typically free with paid preparation at most tax companies and included with tax preparation software, so be sure to check.
Finally, if you find yourself in a crunch with time, you may consider filing an extension, which gives you until October 15, 2012 to file your return. However, people are always surprised to learn that an extension of time to file is not an extension of time to pay. Requesting an extension only allows you more time with the paperwork. If you owe, you still must pay all or most of your taxes by April 17, 2012, or work with the IRS to establish a payment plan. In most cases, taxpayers have what they need and can just file without an extension, so why wait? Tackle those taxes now!
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