Can’t decide what to do with your tax refund? Split it

Eligible current students can also access the American Opportunity Credit, which can cover up to $2,500 annually for four years, and the Lifetime Learning Credit, which can cover up to $2,000 per tax return.

If you’ve gone and done it, though, and are still looking at that pile of tax forms over there in the corner, we’ve compiled a list of six quick-and-dirty tips that could keep you from making some obvious, and not-so-obvious, mistakes when you finally sit down and tackle the task.

“The IRS can penalize taxpayers for both failing to file a tax return and failing to pay taxes they owe by the deadline”, she said.

The IRS said it would send letter to taxpayers alerting them that their accounts were being turned over to private debt collectors to counter fraud. Further cuts in 2018 will weaken our ability to serve taxpayers, especially those who rely on our free assistance – by phone or in person – to file their tax returns. If you can pay everything within 120 days, don’t file Form 9465, McKenzie said. But that’s not how it works.

Get Transcript – Taxpayers can view a tax transcript https://www.irs.gov/individuals/get-transcript , a summary of their tax return, online or order it by mail. There are specific requirements that you must meet to be considered “out of the country” however, so you should visit the IRS website for more information or consult a tax pro. Alternatively, you can use form 4868 Application for Automatic Extension of Time to File U.S. Individual Income Tax Return. In addition, Individuals living outside the USA with their main place of business outside the US are allowed an automatic 2-month extension to file their return. That can drive up the costs of other things in your life, like loan rates and insurance premiums.

For years the Internal Revenue Service has said that IRS agents would not call anyone claiming they owe tax money. But even if your winnings are below that threshold and you don’t get a 1099, you still need to report that income on your taxes.

If you’re due a refund, though, there’s no reason to sweat this deadline.

Many people misunderstand the nature of a tax extension. File electronically. Filing your tax return electronically is faster, easier and less prone to errors. Otherwise, you could end up having to pay taxes. Don’t routinely carry a Social Security card, and make sure tax records are secure.

Bad account numbers. If you arrange for direct deposit of your refund, triple-check account numbers.

St. Onge said take a picture of what you’re donating during the year, as a reminder of what you gave and for possible evidence if you’re audited. Even if you transfer the money to them, you could be on the hook for paying taxes on the entire amount.

If you didn’t have the required health coverage a year ago, you could be in violation of the law if you choose not to pay the penalty and take the chance that the IRS won’t enforce it.

For example: Choosing the wrong filing status can have a big financial impact.

The penalty for late payment is less than for late filing – 0.5% per month, up to 25% of the unpaid tax.

If your 2016 adjusted gross income was $64,000 or less, you can use IRS Free File to prepare and e-file a federal tax return.

The IRS said its private collection agencies will not be aggressive, will never threaten arrest and would not request a weird form of payment. McKenzie notes that the IRS has computers that spot red flags in any filing – whether in April or in an October extension.