The IRS does not have any excuse to spend more than it absolutely needs, even if they are chronic procrastinators.
More than 10,000,000 taxpayers applied last year for an extensionBy filing their tax returns, they can not only save themselves from paying a monthly penalty of 5 percent for missing the IRS deadline but also avoid costly errors in an frantic rush to comply.
“Rushing can cause last-minute filers to forget necessary paperwork and miss out on claiming key tax credits and deductions,” says Elaine Smith, master tax advisor at H&R Block, the giant tax preparation firm.
So with this year’s April 17 filing deadline looming, it’s a big deal that participating offices at H&R Block (www.hrblock.comTax-extension filings will be free for taxpayers from April 1 through D-Day. A extension allows you to file those returns for six additional months, up until October 15.
But don’t stop sweating.
An automatic extension is not an indication that the IRS will grant you a time-out for any tax due. (The U.S. national debt is $15 trillion-and-counting, and the money’s got to come from somewhere.) Failure to submit Form 4868 on time will result in late payment fees as well as interest.
“It’s definitely not a way to keep more of your own money in your pocket,”Smith.
It’s easy to understand why six extra months are necessary, given the complexity of the tax code over the years. Parents of children with special needs know that money paid for supplementary classes and programs for their child is deductible if a doctor recommends it. Oder that unemployment benefits must also be reported as taxable income
That’s why it helps to consult a professional like those at H&R Block, which offers guaranteed in-person services at its retail offices nationwide as well as the only face-to-face online tax preparation through Block LiveSM.
Last thing: If you’re wondering why the filing deadline for this year is April 17, it’s because April 15 is a Sunday and Monday is Emancipation Day.
