Last-minute help in paying taxes
This year's deadline for income tax forms, both Federal and New York State, is Tuesday April 18th. If you're stumped on doing the forms, our Tax Time 411 panel has some help for you:
If you cannot get the paperwork done, Dennis Hebert, Certified Financial Planner with Blue Ocean Strategic Capital suggests filing an extension. Filing is free, but remember that if you owe, you still need to send a payment so that you don't face late penalties. The suggestion is. to pay at least what you paid last year ---if you overpay you will get the 'extra' money back.
Paying with a credit card is NOT a good idea because you'll have to pay credit card interest rates, which are higher than the federal penalties.
Another option is to 'make a deal' with the IRS and set up an installment plan to pay.
Ted Sarenski, from Blue Ocean Strategic Capital, says you use IRS Form 9465. It costs to set it up, but it would cover debts up to $50,000, with up to 6 years to pay.
And, there's still a chance to cut your tax bill, by putting money into special accounts. You can open, or contribute to an existing IRA and take a percentage of that contributed amount off your tax bill, according to Sue Hansen at Hansen's Advisory Services. You could also contribute to your HSA (health savings account). You can contribute up to tax filing time, and have it count as last year's contribution, but you must have it all in before the April 18 deadline, so be sure to allow for time to do the paperwork. One other possibility is the Saver's Credit, for people who are in specific income categories. Check IRS.gov and search 'Saver's Credit' for details.
Our Certified Financial Planners will be back, next Monday to answer your last-minute questions, OR if you have a question about filling out your tax forms, there are IRS-certified Preparers available to help if your income is under $56,000.
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