Why the delay? There were some last minute tax law changes and the IRS needed time to do some reprogramming. That meant that some of us needed to wait until mid February to file our tax returns. If you were like my husband and me, you were not able to file your taxes as early as you wanted. It wasn’t just an electronic issue. There was no advantage to filling out the forms by hand because the IRS didn’t even start processing returns until this week. In my opinion, there’s never an advantage to filing your returns the old-fashioned way.
Why is it better to file electronically? In 2007, 72 million people filed their federal income tax electronically. That number is increasing each and every year. Yes, it is safe and it speeds up the process. The electronic system is faster because the IRS software reads your information faster than a person can. Shorter processing time means a quicker tax refund. If you add direct deposit, your return will be in your bank account very quickly.
I recommend that you file electronically even if you aren’t receiving a refund. Your tax preparer will get a confirmation that your tax return has been received and you won’t have to wait and wonder if your return was lost or damaged in the mail.
Why is it better to file your taxes as soon as possible? The sooner you file, the sooner you know where you stand. Are you missing information? Is some of your information incorrect? Don’t worry if you owe taxes and don’t have the money right away. You can wait to make your payment. Just make sure the IRS receives your money by the deadline in April.
What is the deadline this year? You get a few extra days – if you owe taxes, you have to pay by April 18 instead of April 15. They didn’t give you an extension because of the filing delay. It’s actually because of a holiday. Washington DC celebrates Emancipation Day every year on April 16. This year, it falls on a Saturday, so Washington DC will close their government offices on Friday, April 15 to observe the holiday. That means you will have until Monday, April 18 to pay your taxes.
I hope this gives you good reason to get your taxes done early. If you have an interesting tax story, email me and I’ll share it in the next issue.