MIDLAND, TX (KWES) - Tax Day is Tuesday, which means thousands of people around the country are rushing to get those last-second taxes filed.
If you're one of those people, don't worry, you still have time, but here are some helpful tips we picked up from professionals.
First, file your tax return on time. This is really important because failure to file penalties are much higher than failure to pay penalties. If you can't get your return filed by Tuesday, you need to file for an extension immediately.
Second, make sure you pay what you can. Paying all of it at once may be tough, but if you pay more now, professionals tell us you'll have less interest and less penalties as you scrounge around for the rest of the money. So pay what you can now.
Third, this one is just as important as the others, not many people know this, but you can look into a payment plan with the IRS. Yes, it's hard to believe the IRS allows this, but they do. If you can pay your taxes in less than 120 days, you should because there's no fee to set up that plan. It won't cancel out your interest or late payment penalties, but it shows the IRS you are making an effort.
If you need more than 120 days and owe less than $50,000, you can set up an online payment plan. Set up fees for the online payments run about $100, but even those payments can be reduced with auto payments.
Finally, think twice about raiding your 401K. It may be tempting, but don't, the credit card interest rate might be higher than what you would pay under the IRS payment plan. Another thing to consider, the IRS charges a fee for using a credit card, those two things combined could cost you more money.
It's not the end of the world, but the best advice for everyone who has waited until the last minute, don't do it again.
You can find more helpful tips by visiting the NewsWest 9 Tax Guide page by clicking here.