CAN’T PAY TAXES THEN DO THIS

Can’t pay taxes then do this. This is an exceptional year financially, due to the financial strain from COVID-19. 37% of taxpayers said they do not have the resources to pay 2019 taxes this year, according to a June survey from Tax Audit. The survey of 1,051 respondents was conducted from May 22 to May 23. The Treasury Department delayed the April 15 deadline to July 15 this year, giving taxpayers more time to file their federal income tax returns and pay any taxes owed for 2019. However, despite some earlier warnings, the government opted not to extend it any further. If you still haven’t done your paperwork, you may find the tax bite isn’t as bad as you thought it would be. For example, there is an earned income tax credit for those who qualify, as well as a child tax credit and dependent care expenses credit. Almost 140 million people had filed their tax returns as of June 26th, and the IRS has paid out $259.7 billion in refunds. H&R Block estimates that more than 50% of those who haven’t filed  yet will be getting a refund. Can’t pay taxes then do this.

For those who can’t get their paperwork in on time, they can get an extension until Oct. 15. However, if you fail to file and don’t seek an extension, you’ll be slapped with a penalty of 5% of the unpaid tax you owe. However, an extension to file doesn’t mean an extension to pay. You’ll still owe taxes on July 15. If you don’t pay, you’ll get a 0.5% penalty by the IRS. It is far better to file, even if you cannot pay, then to not file at all, as the penalties for failure to file are the highest penalties of all. However, if you can’t come up with the funds, go to the IRS website to see what’s available and opt for a payment plan. If you owe a large amount you may look for tax resolution.