After being postponed for three months, tax day is here. The filing deadline is Wednesday, July 15. That extension came out of the CARES Act. Every taxpayer got it and did not have to file for it but now that filing deadline is almost here.
"A lot of people who haven't yet filed are, in fact, getting refunds. And another extra bonus this year is that the IRS is actually giving you interest on those refunds," said Vera Gibbons, a personal financial analyst.
Of course, like any activity, filing your taxes amid the pandemic does require extra awareness and precautions.
"The H&R block offices are following social distancing protocols and deep cleaning so people can feel safe going into the office. But if they don't, there's the ability to do it virtually," said Kathy Pickering of H&R Block.
You can also check out GetYourRefund.org. It connects filers with local volunteers who are preparing returns virtually and for free.
"A lot of the programs may be at capacity but one of the things that getyourrefund.org also offers a do it yourself mechanism," said Rebecca Thompson, the National Project Director of Prosperity Now's Taxpayer Opportunity Network.
The free tax prep is for families earning less than $66,000 a year but anyone can use the DIY tool.
"And then they will receive support if needed, via chat or phone support from certified volunteers as well, IRS-certified volunteers," said Thompson.
If you need more time, you can file for an extension. Your new filing date will be October 15, but you must request that extension on or before Wednesday or you'll owe steep penalties.
"The failure to file penalty is 10 times higher than the failure to pay penalties," said Pickering.
To extend your deadline you can either:
Go to www.IRS.gov and click the tab that says "file for an extension."
Download form 4868 and mail it to the IRS before midnight on July 15
Ask your tax preparer to file an extension for you
"An extension to file is not an extension to pay," said Alejandra Castro of the IRS.
If you owe money or think you may owe money to the government you still need to pay on time, even if you are filing for an extension. So estimate what you owe and send in a check for that amount on or by Wednesday.
No matter when you file, beware of tax scams. To correspond with taxpayers, the IRS only sends letters via snail mail. The IRS will never contact you by text, phone, or email. So if someone contacts you using those methods claiming to be from the IRS, do not provide any information. Just hang up or delete the message. It is a scam.
More information from Chuck Minnich of Foundation Capital Management:
One of the biggest mistakes you can make is not filing your return because you owe money. If the bottom line on your return shows that you owe tax, file and pay the amount due in full by the due date if at all possible. If you absolutely cannot pay what you owe, file the return and pay as much as you can afford. You'll owe interest and possibly penalties on the unpaid tax, but you will limit the penalties assessed by filing your return on time, and you may be able to work with the IRS to pay the unpaid balance (options available may include the ability to enter into an installment agreement).
The IRS encourages taxpayers seeking a tax refund to file their tax return as soon as possible. Apparently, most tax refunds are still being issued within 21 days of the IRS receiving a tax return. However, the IRS is experiencing delays in processing paper tax returns due to limited staffing.