The business tax returns started on the 13th January 2014, but for the personal tax returns this system didn’t start accepting the filing of the tax forms until the 1st February 2014.
The lateness of this season is being blamed on the government shutdown in October last year. Those16 days caused havoc with the systems and therefore were not ready on time. The shutdown of the government didn’t resolve any of the issues and it is still having a knock-on effect months later.
The 50 systems that are required to handle the 150 million tax returns they receive needs regular maintenance; the majority of this work is carried out in the autumn and with the shutdown of the government, this meant that the system was going to be behind in the maintenance schedule. This schedule slipped by 3 weeks, so with the date of the 1st February this year the IRS have managed to make up some of the lost time.
But don’t despair because you are now able to file your tax returns. Uncle Sam still wants your money. Even though the system opening 10 days later than expected, you will not get any time for the delay. The closing date for the tax returns still stands at the 15th April. Last year the system was also delayed, this was due to the American Taxpayer Relief Act coming into play.
This delay can cause people the possibility of missing the deadline; if you think that you are going to struggle to meet the deadline then it is a great idea to apply for an extension. It is better to do this than to miss the deadline.
You have two ways of filing your tax return: you can send it in the mail, or you can fill out the details on-line. The method that you prefer is up to you, but remember, if you are sending yours in the post you will need to allow time for the mail to be delivered. If you are filing yours on-line then you will have more time with which to complete the task. But don’t leave it to the last minute, because if your internet connection is lost then you could incur costs for a late tax return. It might not be your fault that the connection was lost, but it is your responsibility to get the tax return filed by the 15th April.
Therefore, even though the government were late with the systems that allow you to file your tax return, this doesn’t mean that you should be late filing. This will cost you money; your tardiness will be noted with a late payment fee of 5% per month or part month that you are late with the filing. If you are then late with the tax that you owe, the IRS will charge you again.
Spend time now getting your taxes in order and get those forms filled in and returned, it can save you money in the long term. But remember you need to pay those taxes by the 15th of April or you will be paying interest on top as well.
Options for spreading the costs
You should be putting money aside each and every month so that when the end of the tax year comes you are ready with the money. This will save you interest payments and possibly late payment fees.
What you can do to reduce the costs:
- Set up a payment plan as early as possible
- Consider using your emergency fund if your tax money is short
- Consider getting a 0% interest credit card and paying it off before the offer expires
The best option is to save more than you think you will need each month and then if you have money left over after paying your taxes a treat for your family could be already paid for.