6 (not so) Dumb Tax Questions You’re Too Embarrassed to Ask
Some of these questions related to tax return may seem foolish or easy, but they certainly are not.
Filing a Federal Tax Return
Do you really have to file it? Very likely.
You should not file for the tax return only when your income is less than personal exemption including standard deduction. This depends on your marital status and age. In general, according to Mark Luscombe (principal federal tax analyst at Wolters Kluwer Tax and Accounting US) any person who made more than $23,100 in 2015 has to file the tax return. However, even your income is much lower, you can benefit from filing a return as you can get a refund. It may happen so that you are entitled to a refundable tax break and receive money as a qualified filer even though the credit surpasses the tax bill.
Withholding my Refund
Is it possible that the IRS withholds my tax refund? This is possible in some situations. For example;
- In case of overdue child support payments;
- If you are late with paying off federal student loans or state income taxes;
- Getting too much of a subsidy from the government for buying health insurance on state or federal exchange.
How Long Does it Take?
Most people get refunds about 21 days from the date they filed the tax return.
You Are Unable to Pay
If you owe money to the IRS and are unable to pay, you should file anyway. Otherwise, this could incur a failure-to-file penalty which is pretty heavy. Also, different payment options are available so you can make an agreement with the IRS to pay in several installments instead of paying at once. On the other hand, if your debt is more than $10,000 we recommend hiring a tax attorney, CPA with experience or registered agent to represent you. If your debt is not that large, you can still seek advice from a tax professional.
When to File
This year, the deadline for filing the tax return was Monday, April 18. For residents of Maine and Massachusetts, it was Tuesday, April 19 as the April 18th is the Patriot’s Day which is a public holiday in these two states. If you cannot meet this deadline, you can apply for automatic 6-month extension form. However, an extension to file does not mean an extension to pay. Any debts you have for 2015 is due to April 18 (or April 19 for Maine and Massachusetts).You can send your check to the IRS with your extension form. Failing to do so, the interest will be added to the amount and a failure-to-pay penalty will be imposed.
How About Audit?
You will most likely not get audited due the budget cuts at the IRS, but this does not mean your tax return will every time escape scrutiny. Make sure to report your income, as the IRS has copies of the tax forms you get from banks, employers, brokers, etc. They use an automated system to check if the numbers on your return match the numbers from their records. Any discrepancy could entail audit.
Find out more informations here: http://www.forbes.com/sites/learnvest/2013/03/19/11-common-questions-about-taxes-answered/#7a5ed44e638a