Monday, March 29, 2010

The Great Tax Season Easter Egg Hunt

This Sunday is Easter and even if you do not celebrate the holiday it is hard not to be overwhelmed by all the pastel eggs and bunny themed candy. Since the tax deadline falls exactly ten days after Easter, millions of Parents will likely spend the weekend searching for tax tips while their children search for colored eggs. To help all of you enjoy your holiday weekend, I have done the hunting for you and gathered the following list of tax Easter Eggs.

Get Free Help with your Tax Return

For those of you who have not yet prepared your tax return because of the associated costs, consider looking into the IRS’ Free File Alliance. The program helps taxpayers whose income is under $57,000 per year find free tax preparation help.

Use Last Years Return as a Guide

If you filed a tax return last year then you can use it as a guide to help prepare your new tax return. Unless you had a drastic change to your finances last year (bought a new house, got married, adopted a child, won the lottery, etc.) then you should be able to copy most of the information from your old return directly onto your 2010 return.

Do Not Assume you can e-File

Unfortunately, there are some instances when you will not be able to e-file your return, so do not make the mistake of waiting until 11:00 pm on April 14th to finish your return. If you need to mail in your return then be sure to check the hours of your local post office to make sure your return will be post marked on the 14th, otherwise you could be hit with a late filing fee.

Last Minute Rush… Always Triple Check

In the rush to get your return finished before the deadline you need to make sure and allow enough time to double, and triple check your return before filing it. I highly recommend finishing your return, then waiting at least a day to review it. If you look over your return right after you complete it then you are less likely to notice potential errors.

Amended Return

If you file your tax return then realize that you have made a mistake, you can always file an amended return. For more information you can check out Topic 308 - Amended Returns on IRS.gov.

File an Extension Right Now

If you are worried about getting your tax return finished before the deadline then you can always request an automatic 6-month extension. To do so, print out IRS Form 4868, Application for Automatic Extension of Time To File U.S. Income Tax Return and mail it to the IRS processing center. Just remember, it is an extension of time to file your return not an extension of time to pay the IRS.

Do Not Ignore the Problem for 6 More Months

If you file an automatic 6-month extension then you will have time to properly complete your tax return. However, do not make the mistake of just ignoring the problem for 6 months by waiting till the last minute. Start gathering your documents now, and if you are planning to get help from a professional then make an appointment within the next few weeks. Most tax offices are closed once tax season ends and it could become difficult to get help if you wait too long.

Last Minute Donations

Congress recently passed a law allowing donations made before April 15th to the Haitian of Chilean relief efforts deductible contributions on your 2009 tax returns. Therefore, you can make donations now to reduce your tax liability from last year. If you filed an automatic extension then make sure you make a donation before the deadline, since the extension will not give you an extra 6 months to make 2009 deductible contributions.

Start Preparing for Next Year

If you have already filed your return, then it is never too early to begin preparing for next year. If you got a refund, then you could follow the advice I provided in a blog entry early last month on tax friendly ways to spend your return. For more information on tax planning for 2010, checkout this article I posted with 10 tips to reduce your tax liability in ’10.