With April 15 looming, millions of Americans are scrambling to submit their tax returns to Uncle Sam on time. On April 8, Yahoo chatted exclusively with United Way Worldwide Director of Income Capacity Building Laura Scherler, who offered up a number of last-minute tax tips designed to help filers avoid penalties and maximize their refund potential.
Although Scherler cited several useful resources for taxpayers, she focused primarily on MyFreeTaxes.com, a project born of a partnership between United Way Worldwide, Goodwill Industries International Disability Institute, and the Walmart Foundation. In addition to valuable tax preparation information including checklists of items to have on hand while filing and a search feature for IRS certified volunteers in your area, the site also offers up free federal and state tax return prep and submission help for individuals and families earning $58,000 per year or less. Visit MyFreeTaxes.com for more information or to see if your family qualifies.
Here’s a quick look at some of Scherler’s dos and don’ts for last-minute filers.
Don’t be late!
Be sure to file on time! Almost without hesitation, Scherler called a failure to file by April 15 “the biggest mistake people make” when it comes to tax time. Although taxpayers can file an extension via the IRS website, she was quick to note that extensions apply only to the time to file; they do not grant additional time to pay. She encouraged filers to either pay what they think they owe, or “as much as you can afford and then work with the IRS to set up a payment plan.”
Don’t overlook deductions.
Remember to see if your family qualifies for the often-overlooked Earned Income Credit and the Child Tax Credit. If you don’t, you could miss out on a significant chunk of change, since according to Scherler, “the Child Tax Credit can provide as much as $1,000 per child in the household and the EITC can provide, the maximum tax credit, is about $6,000 and the average benefit is about $2,300.” But if you don’t file for them, you won’t get them. Also remember to take into account medical expenses and charitable contributions, since they can also potentially reduce your tax bill.
Do file online.
Unless you have a “complicated” family situation or hold “multiple jobs in multiple states,” Scherler suggests skipping the services of pricey tax pros and opting for an online service instead. She praised the products available, noting that they “take a lot of the guesswork” out of the tax prep process by asking “a series of questions that are easily answerable.” And they even “do all of the calculations for you,” which minimizes potential math errors. Even if you wind up needing extra help, it’s available via MyFreeTaxes.com’s volunteer search engine. Scherler also highly recommends requesting that your refund be direct deposited into your bank account to avoid delays and to insure that it’s received as quickly as possible. You need only your bank account number and your bank’s routing number to set it up.
Do have all of your documentation when you sit down to prepare your returns.
Be sure to have your social security card, W-2, 1099, investment and bank account information, child care payment receipts, medical bills, and all “documents related to deductions you might be able to take” handy when you prepare your taxes. If you do, you won’t have to stop midway through the process to search for missing pieces.
Do believe that you can do your own taxes.
“I think one of the most common myths… is that it’s difficult… and that if people do it themselves, they’ll make a mistake.” But with the wide variety of online resources and preparation products available, the guesswork is essentially a non-issue. Be brave!
If you have questions regarding your tax returns, visit IRS.gov or MyFreeTaxes.com for help and information.