Tax Day is here and hopefully you are ready. It can be a daunting task to gather documents and work through returns or get all the required information to a tax preparer on time. If you find yourself unprepared, CPA John Theriot with Malcolm Dienes in Metairie says you can file form 4868 for an extension.
“That gives you all the way to October 15th to file the return. But beware: The extension is only a time to file; it’s not a time to pay. So, if you owe money, you should send it in with that extension,” Theriot explained.
If you don’t send payment, he says, IRS penalties can be up to 5% per month.
Theriot says if you’re rushing to complete your return to beat today’s deadline, don’t forget to fund your IRAs and HSAs. And remember there are new laws that allow exclusions of some tip income and overtime income if you qualify.
“You’ve got to meet certain adjusted gross income limitations, and it’s typically going to be listed on your W-2 in a certain box on your W-2 from your employer,” Theriot noted.
With the new deductions and income exclusions, Theriot says, some taxpayers seem to be getting bigger refunds this year. He says tax rates are down, but that’s not the only reason for the bigger refunds.
“The wage earners, their employers have done a good job of withholding from their salaries, and they are getting bigger refunds,” Theriot said.
He says he hasn’t seen the same for self-employed individuals but adjusting their quarterly payments could make a difference.