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Thursday, April 22, 2021

Tax extension

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Tax extension
Tax extension
Information on tax extension

Ahead on fox 24 news now.

Thank you so much for joining us and taxes are due for those who filed an extension with the irs our resident expert, thomas, has what to do and other helpful tips.

Normally, we see you on a money monday, but because today is tax tuesday, what better than you have tax tuesday with tomas spade.

But however, a lot of people procrastinated and they waited until today to file their taxes.

Some people won't be able to make it.

And i want to talk about what to expect, what happens if you don't file by midnight tonight.

So why don't we get started.

>> one of the worst things that you can do is to ignore t you do want to file a complete and accurate return.

And if you have all of the information to do it, and you know what you're doing, go ahead and file it and electronically file by 11:59 tonight.

In fact, you're fine, and you're still within your extension window.

If you're one day late, then the penalty, if you owe for late filing is 5% per month or fraction there have for the balance due.

>> if you don't file late, there's no penalty.

>> 23 you end up owing something, you have a 5% late filing penalty z.

That's if you're one day late or 30 days late.

And if it goes to 2 months, it maxes out at 25%.

And then of course there's late payment penalty and that goes back to april 15th when the clock starts ticking with that.

And then interest rates.

A prevailing rate right now at 4% per year, and 12% per month.

>> you said by 11:59 tonight, people can e file.

And that means they can electronically file their taxes.

You can't go to the post office at midnight and expect to get a stamp on your envelope that you put it in the mail today.

>> in fact, if i'm not mistaken, the last pickup for any post office in the viewing area is the one on cross county boulevard and i believe their last pickup is at 8:30.

If you paper file, it has to be postmarked today in order for it to be considered on time.

The irs will consider post marks, but however, if the postmark shows a day late, you're automatically going to get that penalty.

>> isn't it important that people get it stamped by the post office or should they send their items to ensure that the irs gets their documentation.

>> i always recommend using certified requested or certified mail.

Because those are the only two proofs of file that the irs will allow.

Even in today's world where they have overnight delivery services, the regulations are only certified receipt requested.

>> and that way, you have your own set of proof?

That's good.

You want to treat this as a learning experience, never to file your taxes late.

So what should you not do though?

If you're not too late, don't slap something together much.

>> do not slap something together.

The penalty for filing a fraudulent return is even more substantial.

So you don't want to just throw something together.

If you tried to throw something together but you missed something, if you under reported your income by 25%, there's another penalty on top of that, and oh, by the way, that takes the statute of limitations out to 6 years that the irs can select a return for an audit.

It's usually three, but if you understate your income by more than 25%, that statute automatically extends to six years.

>> you don't want to file a fraudulent tax return.

A lot of people don't know.

Maybe they're not a tax expert.

And they think they're doing it right.

>> remember, there's a difference between fraudulent and a difference between that and say something with an error on t but even if you under stated it just by an error because you forgot to include something, that could kick the statute up to 6 years if you understated the income by 25%.

>> we have to >> beer back with tom spade, our tax guru, and how have the classes been going.

>> awesome.

And i have great students this semester, and i have to say hi any of them watching but they're on fall break, so.

>> they will watch the rerun of this.

Do your homework, everybody, and we're doing our homework with you, because there's a lot of stuff we don't know.

There are things that we don't even know about our very own money.

Speaking of which, refunds.

If overreached how long do you have to claim it?

Is it just there forever?

Or years from now?

>> no, you can't.

Here's the deal.

Let's say you decided i don't need to file a tax return because i never owe anything, and in fact, i'm probably going to have a refund.

And this year especially, that's the case, remember they changed everything, so you definitely want to file for this year, and second, let's say you were due back a refund.

You only have three years to claim that.

So if you go back say four years from now and you try to file a return get that refund from four years ago, the irs is probably going to say sorry, the statute is expired, thank you for your contribution to the united states government.

>> what?

>> yes much.

>> well, you probably want that money in your pocket so what do you do, call up an accountant or tax expert.

>> call up an accountant, a professional.

And if it's simple enough where you have a w-2, charitable contributions, there are file options, go to or go and buy one of the tax preparation software packages so you can file it and get money back instead of just giving a tax-free gift to the government, which by the way does not count as a charitable contribution.

>> so you can't deduct it the next year.

How much is that software?

>> honestly, i don't know.

I think it's 30-$50, but for people that have less than say about $50,000 in gross income a year, they can usually file it for free.

If you go to they have links to some of their partners that offer free electronic filing.

>> let's talk about hurricane dorian.

So often, we have an extension october extension.

So we have 1:30 left.

So let's get to whether or not we qualify for an extension.

>> not this year.

>> why not?

>> in order to get an extension to the extension on a disaster, like what we have had almost every year going back the last four or five years, two things need to happen.

We have to have both a presidential disaster declaration for the area, as well as fema coming in and saying that residents in about area can apply for funds from fema to rebuild or recover or take care of the fallen oak tree in the front yard.

>> so really, it's fema that it depends on.

>> it depends on both of them.

>> but usually the president declares a disaster.

>> so we got that.

What we didn't get was fema coming through and saying that we would get individual assistance in our area.

I don't think it's going to happen.

Especially because after tropical storm imelda, which had issues all over texas, they were gven assistance, and they have an individual extension, but however, we don't.

>> we're going to have to bring you back because the next time we talk, we're going to talk about record keeping and what we need in april of 20 20.

>> thank you for having me as usual.

>> when we return, speaking of reached checks, what you needy to know before you spend the money during the holidays, and we continue our series


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