Tax deadline looms: Top tips for late filers

By TaxesFOXBusiness

The tax deadline for 2018 is approaching, and if you haven’t filed yet, now’s the time to think about getting your paperwork in order.

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Filing past the deadline, without an extension, could lead to penalties. The failure to file penalty is usually 5% of the amount of taxes owed for each month, up to a maximum of 25%. After 60 days of failure to file, the minimum penalty is the lesser of either $210 or the full amount of taxes owed.

In order to avoid paying a penalty to the IRS this year, here’s what you need to know as the deadline draws near:

The deadline is not April 15

This year taxpayers have two extra days to file, until midnight on Tuesday, April 17. The deadline is delayed this year because April 15 falls on a Sunday, and Monday April 16th is Emancipation Day, which commemorates the day in 1862 when President Abraham Lincoln signed a declaration that freed more than 3,000 slaves in Washington. The holiday is locally celebrated in D.C., and happened about nine months before the day when the Emancipation Proclamation was signed on Jan. 1, 1863.

IRA contributions

If you plan on contributing to your IRA this year, you can do so by April 17 and collect the deduction on your 2017 taxes. This deduction applies to those who aren’t itemizing as well.

However, if you plan on opening an account, you may want to do so in advance, or the benefits may be applied

The contribution limit for those under the age of 50 is $5,500, while Americans ages 50 and over can contribute $6,500.

Filing for an extension

If you know that you are not going to meet the deadline this year, file for an extension in order to avoid being hit with penalties.

The IRS has an online form to do so on its website, which must be completed by April 17. Alternatively, you can mail in paperwork.

It is important to note that receiving an extension does not delay the deadline by which you owe any tax dues. Failure to pay could result in a penalty and accrued interest.

If you file for an extension, your documents will be due to the IRS by Oct. 15, 2018.

Payments can be made electronically to the IRS, which the agency says is the easiest way. You can also pay by check or money order, but cash payments are not accepted.

Remember: scammers

Earlier this year the IRS issued a warning that scammers were increasingly targeting taxpayers’ refunds, something to be mindful of as you file. According to the agency, thieves use victims’ real information to file a fake return, have the refund deposited into the taxpayers’ real bank accounts and then use various tactics to steal the cash.

There are two versions of the scam thieves are using to collect the fraudulent refund from taxpayers. One involves criminals calling taxpayers acting as IRS-sanctioned debt collection agency officials to tell them the refund was mistakenly deposited and asking them to forward the money to their “collection agency.”

The other features an automated call saying the taxpayer is in danger of being charged with criminal fraud unless she returns the refund.

You are at risk of fraud if, when you file, you receive a bounce back notification from the IRS that your Social Security number is already associated with a return. This indicates someone else has filed using your information.

For more tax tips and insights, click here.