The same people seem procrastinate on their taxes every year. There are some last-minute filers who get a tax refund every year, but still wait until the last week before the tax deadline to think about towing their shoebox of documents somewhere to get their taxes prepared. They're joined by all of the other procrastinators, only to find they have to wait in line or may not even make the cutoff to get their taxes done.
If you're one of these late filers, here are some tips to help you file by the tax deadline and save time and money:
1. Save time and about $100 by going online. There are free tax-filing options online and you don't have to hire a babysitter or waste gas to have your taxes prepared. Most taxpayers have pretty simple tax returns--and even if you don't, you can do your taxes online and still get free help when using some tax software.
2. E-file with direct deposit. You can avoid long lines at the post office if you e-file your tax return. Your e-filed return is safely transmitted to the IRS and you can track the status of your tax refund. If you mail your tax return, you are left in the dark about where your tax refund is for about four weeks--or even if the IRS received your tax return. The big benefit: When you e-file with direct deposit, the IRS estimates 9 out of 10 taxpayers will receive their tax refund within 21 days, as opposed to the four to six weeks for a mailed return.
3. Use new apps to prepare taxes. We've all gone mobile and are using it for just about everything. If you're in a real crunch, you can use mobile apps like SnapTax to safely prepare and e-file your taxes in about minutes.
4. Group your documents. Before sitting down to prepare your taxes, organize your tax forms by category. Put anything related to income (W-2s, 1099s) together and next receipts for expenses (mortgage interest 1098, property taxes, DMV documents, charitable contribution receipts, and business expenses to name a few). This way you will have everything ready and won't leave anything out.
5. Eliminate common tax errors. Errors that top the IRS leaderboard year after year can be eliminated if you take your time. Double check the spelling of you, your spouse and dependents' names and social security numbers. Incorrectly spelled names or erroneous social security numbers will eliminate valuable tax deductions and credits that boost your tax refund.
6. Maximize your deductions. Even if you wait until the last minute, don't forget about the money you shelled out for expenses in 2012. Taxpayers often forget about deductions like previous state tax liability paid, job search, summer day camp--even the cost of moving a pet may saves money on taxes.
7. File even in the 11th hour. Don't throw in the towel and file an extension if you can hit the e-file button at 11:59 pm on April 15. You can file an extension if you want, but remember it is an extension to file and not to pay taxes owed.
8. Take advantage of the Fresh Start Initiative (if you can't pay). If you find you owe money and can't pay after preparing your taxes, file your taxes anyway and apply for an installment agreement or other options under the IRS Fresh Start Initiative, which offers relief to struggling taxpayers. This way, you can still file and lessen some of the penalties incurred on your unpaid tax liability.
Following these tax tips will help you beat the tax deadline and save money.
Lisa Greene-Lewis is a CPA and TurboTax Tax Expert. She has more than 15 years of experience in tax preparation, inlcuding positions as a public auditor, controller, and operations manager. For more tax-related tips, go to blog.turbotax.intuit.com.
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