In a few months, the tax filing season will be upon us. If you are required to file a tax return for 2014, it's a good idea to start planning ahead now. First, you must determine the correct amount of taxes you owe. Underpayment or misreporting can lead to a tax liability. If you are unsure of how much you owe in taxes, you can seek help from a tax professional or use an IRS Volunteer at the Income Tax Assistance (VITA) center.
A VITA center provides free tax preparation to individuals that cannot afford to hire professional tax preparers. Generally, taxpayers that earn $53,000 or less a year, people with disabilities, immigrants, and the elderly can get help at VITA centers. IRS-certified volunteers provide free assistance in tax preparation. Taxpayers can not only get assistance, they can obtain important information at these centers.
Even if you cannot pay the full amount of taxes you owe, you still need to file your tax return to avoid failure-to-file penalties. Even if you pay the balance after filing season, it's important to file your return on time. It's wise to pay as much as your can up front, and, if necessary, pay the balance in monthly installments with an IRS payment plan. Planning your resolution early will mean paying your back taxes sooner and avoiding IRS penalties and interest.
When you're preparing your return, be careful in claiming credits and deductions. If you claim wrong or excessive credits and deductions, the IRS will correct the errors and assess a tax debt for you.
Labels: Back Taxes, IRS, Tax Credit, Tax Deductions, Tax Filing, Taxpayers