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Saturday May 18, 2024

Washington News

Washington Hotline

April 15 - File or Extend?

As the April 15 tax deadline rapidly approaches, the Internal Revenue Service (IRS) reminded taxpayers that they have multiple filing and payment options. The IRS continues to recommend that taxpayers file returns electronically. The software used for electronic returns reduces possible tax errors. It also facilitates prompt refunds — most individuals receive a refund within 21 days.

Taxpayers with income of $79,000 or less may use the IRS Free File software. Individuals with higher incomes can use the IRS Free Fillable forms. A new option this filing season is IRS Direct File. The IRS tax software is available for basic returns in 12 pilot states. The IRS.gov website has additional information on the Direct File program.

The IRS also encourages individuals to use the Volunteer Income Tax Assistance (VITA) or the Tax Counseling for the Elderly (TCE) programs. These programs offer free tax preparation to most individuals or seniors. Members of the military also may benefit from MilTax, a Department of Defense program offering free tax return preparation.

Taxpayers are encouraged to use the "Where’s My Refund?" tool. This helpful program on the IRS.gov website is available if you have your Social Security number, your filing status and your exact refund amount. You can also use the "Where’s My Refund?" service on your smartphone with the IRS2Go app.

If you owe taxes, you must pay the correct amount by Monday, April 15. An exception is available for residents of Maine or Massachusetts. Due to state holidays, their tax deadline is Wednesday, April 17, 2024.

There are multiple options to pay your taxes. An excellent method is Direct Pay from your checking or savings account. You may also pay with a debit card, credit card or digital wallet. The Electronic Federal Tax Payment System (EFTPS) is a convenient method. Many taxpayers use an electronic funds withdrawal from their bank account. Other options include a check or money order or cash. The cash payment is more complex and is explained on IRS.gov/payments/pay-your-taxes-with-cash.

If you are not able to pay your tax in full, there are both short and long-term payment plan options. A tax bill of less than $100,000 may be paid over 180 days with the short-term plan. If you owe less than $50,000 in tax, penalties and interest, the long-term payment plan may allow you to stretch out payments for up to 72 months. You may go to the webpage IRS.gov/payments/payment-plans-installment-agreements to view qualifications for payment plans.

If you are unable to file by April 15, you can use IRS Form 4868, Application for Automatic Extension of Time to File U.S. Individual Income Tax Return. The six-month deferral will allow you to file by October 15, 2024. However, you are required to pay the correct amount of tax by April 15th, even if you extend the filing date. You should estimate and pay your correct tax due. There are exceptions for individuals serving in a combat zone, those living outside the United States or taxpayers in certain disaster areas.

Published April 5, 2024
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