Tax Day is almost here, and if you have been putting off preparing your tax return because you fear finding out that you owe money. You can take comfort in knowing that you are not alone. Not everyone is doing the happy dance all the way to the bank with big, fat refund checks. There are plenty of people who will find out that they owe tax this year. They just are not shouting about it from the rooftops like those folks who are getting refunds.
Since there are penalties, including financial penalties for not filing your tax return on time it is important that you prepare and file your return soon so that it does not cost you any more money than it has to. Once you figure out how much you owe, you can make a plan for how you will pay it. Fortunately, if you owe tax, there are other options available than paying the full amount all at once.
Although the options that are available for paying your tax bill over time are not free (there are interest fees and sometimes penalties too), they are less costly than the fees and penalties for not filing your return on time. The options that are available to you may differ, depending upon your situation. For example, unemployed people and struggling small business owners can get up to six additional months to pay their tax bill. Those who owe less than $50,000.00 can make arrangements for an installment agreement without having to fill out as many complicated forms as they may have had to in previous years. An offer in compromise, to pay less than you owe, is a very hard thing to qualify for but they do exist.
Please remember, I am no tax expert, nor do I pretend to be one. It is important to seek advice from a qualified tax professional, or from the IRS for how to proceed in your specific situation.
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