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Personal Finance Round-Up: Should You Consider Filing a Tax Extension?

By Money Crashers

doing taxesWith this year’s tax deadline, you get three extra days to get everything finished. But if you haven’t started yet or if you’re not close to being done, you might want to consider filing a tax extension.

As explained by Smart On Money in No Need To Rush. Get An Extension On Filing Your Taxes! there are rules you have to follow when filing a tax extension but if you can meet those requirements, you will get an extra six months to get your tax info together and avoid any late penalties the IRS imposes.

One thing to remember though is that even if you are filing an extension, you still have to pay any fees you owe the IRS and the extension only applies to the paperwork portion of taxes. You’ll have to estimate how much you owe the IRS and pay that by the tax deadline. If the IRS thinks you’re making things up, they can penalize you and charge you interest when things are eventually reviewed.

The good news is that it doesn’t take much time to prepare an accurate estimate of taxes owed by using tax preparation software like TurboTax, which you can use to file the tax extension electronically with the IRS.

Here are some other great articles to help you with your taxes:

Maximize Your Tax Refund
Getting a refund from the IRS can be quite a treat, especially if the amount is unexpectedly large due to newly instituted credits. Here are some great ways to grow your refund with credits and deductions that you might have otherwise missed. [Kiplinger]

8 Smart Things to Do With Your Tax Refund
What exactly do you do with a large refund from the IRS? Is it play money, or do you put it right back to work for you? Here are some great ways to make use of the money and have it pay off long-term. [WiseBread]

How to Get Your Taxes Done for Much Less – or Even Free
Did you know that Uncle Sam provides ways for you to file your taxes for free, or even have them professionally prepared at no cost to you? Check out this article to see if you qualify. [Cool To Be Frugal]

Notable 2011 Tax Changes: How they May Impact You
Now that 2010 tax season is coming to a close, you can start thinking about…2011 tax season! There are some new upcoming changes you should be aware of. [Couple Money]

How to Report Taxes on Bartering for Goods or Services
Back before currency was the standard, bartering was the main way you would provide for your family. But did you know you still have to pay taxes on barter trades? [My Dollar Plan]

10 Ways to Run Your Budget Like the Government
What exactly are taxes used for? Well, we may never really know but observing how things are run over at the White House can teach us a lot about what we shouldn’t do with our money. [No Debt Plan]

6 Alternative Investments That May Beat Stocks and Bonds Over the Next Decade
If you plan on investing your tax refund, consider some unconventional investment strategies. The stock market is still tough, but that creates great opportunities in other areas of commerce. [Darwin’s Finance]

(photo credit: Shutterstock)

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  • http://www.Invesmint.com Bernz

    This is actually the first time in my entire life that I will be filing for an extension. Looks like a smooth process, just got back from my accountant yesterday (yes Sunday) and everything is all set. Had to make estimated payments though. We’ll see how it goes.

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