Not Filing at All
Even if you don't have the funds to pay your tax liability at the moment, the IRS encourages everyone to file something.
One option is to file an installment agreement request (Form 9465). This form allows you to outline a payment schedule for your taxes in the event you don't have the money to pay all at once. The IRS will accept your installment plan if you meet a certain set of requirements. For instance, you'll can't already be on an installment plan with the IRS. While you will still be charged interest and penalties once you've worked out a repayment schedule, those rates are much better than the rates for not filing at all.
Another option is to file for an application for automatic extension of time to file U.S. individual income tax return (Form 4868). Granted, the form's name is a mouthful, but the six-month extension for filing your returns that you'll receive in return will help you forgive the clunky title. While a 4868 doesn't grant you an extension on payments, the penalties for late payment are much less severe.
No matter what you do, don't let April 15 pass you by without filing your returns. Even if you're owed a refund, you'll cause yourself problems in the future by not filing (and you can lose your refund in the process).
Keep reading for more links on the tax man.
Related HowStuffWorks Articles
More Great Links
- Bankrate. "Bankrate's 2009 Tax Guide." (March 27, 2009)http://www.bankrate.com/brm/itax/news/taxguide/default.asp
- Bell, Kay. "Which tax return form should you use?" Jan. 7, 2009. (March 27, 2009)http://www.bankrate.com/brm/itax/tips/20010207a.asp?caret=1
- Bell, Kay. "2008 deduction mounts." Bankrate. Jan. 5, 2009. (March 27, 2009)http://www.bankrate.com/brm/itax/news/taxguide/deduction-amounts1.asp?caret=20
- CNN. "Tax issues prompt Obama nominee to withdraw." Feb. 3, 2009. (March 27, 2009)http://www.cnn.com/2009/POLITICS/02/03/performance.nominee.withdraws/index.html
- Dowling, Nicola. "Tax dodger faked death." Manchester Evening News. Sept. 24, 2007. (March 27, 2009)http://www.manchestereveningnews.co.uk/news/s/1017366_tax_dodger_faked_death
- IRS. "Amended Returns & Form 1040X." Nov. 26, 2008. (March 27, 2009)http://www.irs.gov/faqs/faq/0,,id=199548,00.html
- IRS. "Checklist of Common Errors When Preparing Your Tax Return." Feb. 26, 2009. (March 27, 2009)http://www.irs.gov/taxtopics/tc303.html
- IRS. "Collection Procedural Questions." March 5, 2009. (March 27, 2009)http://www.irs.gov/faqs/faq/0,,id=199556,00.html
- IRS. "How long should I keep records?" April 8, 2008. (March 27, 2009)http://www.irs.gov/businesses/small/article/0,,id=98513,00.html
- IRS. "IRS Urges Taxpayers to Avoid Last Minute Filing: Tips to Avoid the Rush of the April 15 Deadline." Feb. 20, 2007. (March 27, 2009)http://www.irs.gov/newsroom/article/0,,id=108441,00.html
- IRS. "IRS Urgest Taxpayers to Avoid Common Mistakes." April 3, 2007. (March 27, 2009)http://www.irs.gov/newsroom/article/0,,id=169240,00.html
- IRS. "Tax Fraud Alerts." July 17, 2008. (March 27, 2009)http://www.irs.gov/compliance/enforcement/article/0,,id=121259,00.html
- Johnson, Caitlin A. "Don't Give Uncle Sam Too Much At Tax Time." Feb. 28, 2007. (March 27, 2009)http://www.cbsnews.com/stories/2007/02/28/earlyshow/contributors/raymartin/main2523399.shtml
- MSNBC. "Missing pilot had ties to Delta bankruptcy case." Jan. 13, 2009. (March 27, 2009)http://www.msnbc.msn.com/id/28643100/
- Pear, Robert. "Daschle Pays 3 Years of Tax on Use of Car." Jan. 30, 2009. (March 27, 2009)http://www.nytimes.com/2009/01/31/us/politics/31daschle.html?_r=3&hp
- Reuters. "CCH CompleteTax Highlights Tax Changes Affecting 2008 Individual Income Tax Returns." Jan. 30, 2009. (March 27, 2009)http://www.reuters.com/article/pressRelease/idUS183224+30-Jan-2009+BW20090130
- Solomon, Deborah. "Geithner Apologizes, Calls for 'Dramatic' Action." Jan. 22, 2009. (March 27, 2009)http://online.wsj.com/article/SB123254915519002447.html
- Weisman, Jonathan. "Obama Pick for Trade Job Agrees to Pay Back Taxes." The Wall Street Journal. March 2, 2009. (March 27, 2009)http://online.wsj.com/article/SB123602702513013031.html
Many Americans don't think about their tax bills until the new year. But there are things you need to do before Dec. 31 if you want to pay less later.