We are wide-eyed at the thought, but April 15
is right around the corner! As the end of tax season draws near, late-filers may be wondering where to start. We can look forward to the ACA implications next year – but what do you need to know NOW about taxes?
Well, we at Jackson Hewitt wanted to share five key things about the final days of tax season, five things to watch out for, and five things to do before April 15
. And we’d welcome your feedback for things to do as we rejoin the world of the living as tax season comes to an end!
5 Things to Know About April 15th
- To have your taxes filed by the deadline, you must file before midnight April 15, 2014.
- You can file for a tax filing extension, which would make your deadline October 15, 2014. It’s important to remember that an extension is a delay to file tax forms not to pay a tax liability. Taxes must still be paid by April 15th or interest and penalties will accrue.
- If you are paying taxes with your extension to avoid the late payment penalty, you must pay at least 90% of your final tax liability or you will be assessed a late payment penalty.
- If you make quarterly estimated tax payments, your first payment is due April 15th.
- You can make a contribution to a traditional IRA as late as April 15th to lower the taxable income on your 2013 tax return.
5 Things to Watch Out For
- While the IRS doesn’t penalize you for filing late when you are due a refund, many states do.
- There are three new taxes this year: additional 0.9% Medicare tax on wages greater than $200,000 ($250,000 if married filing jointly), 3.8% Medicare tax on investment income when adjusted gross income is greater than $200,000 ($250,000 if married filing jointly), and 39.6% income tax on taxable income greater than $400,000 ($450,000 if married filing jointly).
- Itemized deductions phase out when adjusted gross income is greater than $250,000 ($300,000 if married filing jointly).
- The IRS will notify you, and penalize you, when you forget to include income on your return.
- The IRS will not notify you if you forget to claim a deduction or credit you may have been entitled to.
5 Things To Do Before You File Your Taxes
- Locate last year’s tax return; it’s a useful guideline to help you determine what you’ll need to file this year’s tax return.
- Locate all the forms W-2 and 1099s employers, banks, and others sent you in January and February. Gather receipts and/or statements for possible deductions like mortgage interest, charitable contributions and tuition and fees for yourself or other family members.
- Don’t wait until the last minute; it is too easy to make a mistake and forget deductions, credits, or even income when you are rushed.
- Review all of the information on your tax return such as; Social Security numbers, the spelling of names, withholdings and estimated taxes reported.
- If you’ve already filed, but are unsure you’ve gotten all of the deductions and credits you were entitled to, there is still time to have your return reviewed. You can have up to three years of returns reviewed.
Now, we’d love your suggestions as to what to do on April 16th when our world shifts and we have a chance to relax. The one who needs the most guidance is Mark Steber, our Chief Tax Officer. A native of Alabama and an unfortunate fan of the Crimson Tide, he’s a colorful gent full of tax passion. (Now you know what the “P” his CPA stands for!) Please feel free to send him your April 16th suggestions (and tax inquiries) at email@example.com or call his cell at (941) 345-5646. Day or night: it doesn’t matter since we don’t really sleep. And just know that Brother Steber gives an amazingly spirited interview if the need should arise over the next few weeks.