What to do if you owe money
on April 15th
This is NOT an April Fool's Day Post. Taxes are due in 2 weeks.
(And see my other post below if you owe money)
Now some people may get an extension of time to file their returns because they may be waiting for information from others. Or, they just hate working on accumulating the data to prepare their return.
DON'T FALL INTO A TRAP!
The extension just gives you more time to file the actual return. You still have to pay your taxes by April 15.
"Wait ... I still have to pay even though I don't have my return complete and am not sure what I owe?" you ask.
Yes, you still have to pay. By April 15. Think about it. If you could just extend the time to pay by filing an extension, why wouldn't everyone that owed taxes just do that?
You have to make a reasonable estimate of what you think you may owe and pay it. What is considered a "reasonable" estimate of your tax? 90% of the actual tax due when you file your return. Any underpayment of the tax will be charged interest and a late payment penalty. But at least you will not be subject to the late filing penalty which can be as much as 25% of the total tax.
That's right ... if you do not file an extension and/or do not pay in at least 90% of your taxes owed, you could be subject to a penalty of 5% per month to a maximum of 25% of the total tax for late filing.
Don't have the money to pay right now?
Take a look at my other post on what to do when you owe money.
Need help preparing your return, calculating what you may owe with your extension?
That's where I come in. Contact me and I can help you.