Tax Deadline Extended to April 18
Emancipation Day in Washington, D.C. falls on April 15 this year. Because of this holiday, the federal income tax filing deadline moves to April 18. While this extension offers a little extra time, the deadline is still approaching fast.
The Association of Independent Consumer Credit Counseling Agencies (AICCCA) urges taxpayers who have not prepared yet to start planning and saving now.
Know What You Owe
Consumers who expect to owe taxes should first learn how much they must pay. According to Dave Jones, president of AICCCA, this step is critical. Once you know your tax bill, you can create a clear plan to pay it.
Calculate your taxes as soon as possible. You can do this yourself or work with a tax professional. If you still use paper tax forms, consider using tax software. Software can help you find deductions you may miss.
Steps to Take Before Tax Day
1. Determine Your Tax Liability
Find out how much you owe right away. The earlier you know, the more time you have to prepare. Early planning reduces stress and last-minute decisions.
2. Set a Weekly Savings Goal
If you owe taxes, review your budget carefully. Cut back on non-essential spending, such as dining out or vacations. Next, look for ways to save on necessities like groceries, utilities, and clothing.
You can also increase your income. Ask about overtime at work. Consider taking a temporary second job. You may also sell unused items through a garage sale and apply the money toward your tax bill.
Steps to Take on Tax Day
1. File Your Return on Time
Always file by April 18. Late filing leads to IRS penalties. Even if you cannot pay in full, filing on time reduces extra costs.
You may request a filing extension, but remember this does not extend payment. The IRS usually requires at least a partial payment by the deadline.
2. Review Your Payment Options
If you need to borrow money to pay your taxes, compare all options carefully. Choices include a bank loan, an IRS installment plan, or an IRS-approved credit card.
Each option includes costs. Bank loans charge interest. IRS plans include fees and interest. Credit cards add convenience fees and interest. If you use a credit card, plan to pay it off quickly.
Steps to Take After Tax Season
1. Review Your W-4 Withholdings
Review your W-4 form every year. If you receive a large refund, you may be over-withholding. Adjusting your W-4 allows you to keep more money throughout the year.
If you owe taxes each year, lower your withholdings or ask your employer to deduct extra tax from each paycheck.
2. Get Professional Help if Needed
If paying your taxes feels overwhelming, seek help. AICCCA member agencies can assist with budgeting and tax planning.
Founded in 1993, Association of Independent Consumer Credit Counseling Agencies (AICCCA) is a national membership organization, established to promote quality and consistent delivery of credit counseling services. AICCCA and its members are focused on improved creditor relations, efficient processes and advanced technology to best serve clients and creditors. AICCCA members are independent nonprofit agencies that advocate for debtors, counsel millions of consumers annually nationwide and provide debt management services to consumers with excessive unsecured debt. For more information or to contact an AICCCA member office call 866-703-TRUSTAICCCA (866-703-8787) or visit https://www.aiccca.org/.
Source
