Welcome to the first full week of April, the big month when it comes to taxes.
After the two previous delayed Tax Day filing seasons, the Internal Revenue Service is committed to getting back on schedule, at least as far as the deadline for us taxpayers to meet.
If you've yet to file your 2021 return, here are five tax tasks to complete as the April 18 filing deadline nears.
1. Decide what you're going to do about your 2021 return. With Tax Day just two weeks away, the IRS still is waiting on millions of returns.
Are you among these late filers? No worries. You still have time. But you need to decide what you're going to do soon.
If you started filling out your Form 1040 and then set it aside, give that earlier tax work another look. If you haven't started the filing process at all, but plan to file yourself, get started.
Of, if it's just too overwhelming, file for an extension. The IRS is OK with this, too.
Sloppy, error-ridden returns submitted in haste are a hassle for everyone. The IRS would rather you take the extra six months you get by submitting Form 4868 by the April deadline to fill out and file your form later, and accurately.
2. Pay any 2021 tax you owe. While the IRS has no problems with extended tax filings, it's not so accepting of tax debts that aren't settled by Tax Day. That Form 4868 you filed is only for more time to file your tax paperwork, not more time to pay any tax you owe. When you file for an extension, you also need to send in a good estimate of any due tax.
Let me repeat that. You need to make a good estimate of your tax bill. Don't send in an unrealistic amount. If you underpay, the due amount will be subject to penalties and interest that starts accruing the day after your payment deadline.
3. Make your first 2022 estimated tax payment. I know, estimated taxes are a major pain in the backside. But if you don't make them on income that's not subject to withholding and then end up owing the next filing season, you could face underpayment penalties and interest charges.
So as you're working on your 2021 taxes, make sure you run your expected 2022 tax year numbers, too. Then make the first of these four extra tax payments for the current tax year on April 18.
Yep, estimated tax for the first quarter of the year is due on the same day April day as your tax filing for the previous tax year.
And sorry, there's no extension for estimated taxes.
4. File your 2018 tax return. You read that date right. If you didn't file your 2018 tax return back in 2019 and were due a refund back then, Tax Day 2022 is the last chance you'll get to collect that money.
Millions of folks every year somehow overlook filing even when they're due a refund. The IRS wants to send that unclaimed refund amount to you, but you've got to ask. By law, you only have three years to do that. That means you must file a tax year 2018 Form 1040 to get that year's refund by this year's fast-approaching April 2022 deadline.
If you don't file this month to get your old refund, Uncle Sam gets to keep your money. All of it. Forever.
5. Don't forget your state taxes. Most Americans also must file some type of state tax return. And most of those state (and some local, too) tax forms follow the IRS schedule, meaning they also are due this year by April 18, or April 19 if you live in Maine or Massachusetts, where the Patriots Day holiday provides 24 extra hours. Some disaster victims get an even later due date.
The good news is that most of the states that require their residents to file returns offer free online tax filing options.
But if you can't get your federal return done by the due date, chances are you won't complete your state tax forms either since, in most cases, state filings are based on what you report on your federal taxes.
If that's your filing situation, check with your state's tax office about getting an extension to file these forms, too. In some cases, you don't have to do anything. Others state tax collectors, though, could require you at least give them notice that you'll be sending in the forms a bit late.
More April tax moves: These five April tax tasks focus on finishing up 2021 tax returns. That's because that's the biggest concern right now of filing procrastinators, as well as IRS staff that must process them.
But if you've already filed, or are in good shape to meet April 18 (or 19 for my New England readers), you can find some additional April Tax Moves in the ol' blog's right column.
As is the custom, these monthly pieces of tax advice are listed under the countdown clock that's keeping track of the countdown to Tax Day 2022.
Yes, there are plenty that focus on April 18. But there are some general tax tidbits, as well as tax actions to take once you've filed your returns. Wherever you are on the tax filing season spectrum, thanks for taking a few minutes to peruse them.
Finally, as we head into this final month of high tax filing season, a few words for my fellow taxpayers.
For all y'all who are still working on 2021's 1040s, as well as running 2022 estimated tax calculations, you have my heartfelt empathy. Hang in there. We're almost done!
As for those tax go-getters who've met your annual filing obligation, congratulations … tinged with a bit of envy.
You also might find these items of interest:
- Monthly Tax Tips
- Don't forget about your state taxes
- Don't fall for these 10 tax myths on April Fools' (or any) day