By Johnny Jackson
Al and Linda Eubanks, of Jonesboro, spent about three hours Tuesday at H&R Block, preparing their taxes.
"I held it off until the last minute," Al Eubanks said.
"We were pretty apprehensive," added Linda Eubanks. "We didn't know what to expect. It turned out good for us."
Tuesday (April 15) was one of the busiest days of the year for tax preparation companies like H&R Block - second only to the period in February, when many rush to file their taxes early.
"We don't see tremendous amounts of people who come in after the 15th," said Jason Campbell, H&R Block district manager for Henry and Clayton counties.
Typical for the deadline rush are business people filing in accordance with their investments, Campbell said. But for those who did not make the April 15 deadline and may owe on taxes, there is still time to file - albeit with some penalties.
Many taxpayers filed for extensions to the deadline on Tuesday, extending it from April 15 to Oct. 15, 2008. "It is an extension on having the tax return filed, not an extension to pay the IRS what you owe," Campbell reiterated.
Extension Form 4868 is available through the IRS web site. Taxpayers may also e-file an extension request using tax preparation software or by going through their tax preparer.
Taxpayers who are due refunds are not penalized for filing their income taxes late. However, officials urge those who do not meet the April 15 deadline to file for extensions to avoid penalties that may arise in the process. Late filing penalties are 5 percent per month (up to 25 percent) for taxes owed with a 6 percent interest rate.
"Take care of your situation as quickly as possible," advised Campbell. "Don't prolong the situation. Don't ignore anything that comes through [from the Internal Revenue Service]. The IRS is one of those branches of government - they'll definitely work with you."
The IRS may work out a plan of monthly installments to assist taxpayers in paying what they owe. Many people, however, make the mistake of trying to work out their tax situation without much assistance, said Tina Simpson, an H&R Block tax preparer.
"I have learned that everyone's tax situation is unique," said Simpson, who has been a seasonal tax preparer the last four tax seasons. "I'd advise them to seek the advice of a qualified professional. A common misconception is that they don't need tax professionals."
She said some taxpayers often miss out on new tax credits they could take advantage of that professionals would know about. Those who missed the deadline, for instance, may still be eligible for this year's economic stimulus payments, or "rebates."
Individual taxpayers, who file and are eligible for the rebates, will automatically receive as much as $600. Taxpayers filing jointly can receive as much as $1,200 and an additional $300, if they qualify for the child tax credit.
According to IRS spokesman Mark Green, late filers will still receive rebates as long as they file their 2007 tax returns by the end of this year (2008), and are eligible to receive the rebate.
The IRS will send a notice to taxpayers indicating when they could receive the rebates and how much they qualify to receive.
Green said taxpayers should keep those notices on file to use for possible credit on next year's 2008 income tax returns.
"You can avoid headaches at tax time by keeping track of your receipts and other records throughout the year," Green said. "If you don't have a record-keeping system, now is a good time to start one for tax year 2008.
"It can be as simple as file folders or a shoe box," he added. "Just put everything that relates to taxes in one place ... the more organized your records are, the easier it will be to complete your tax return next year. A good record-keeping system can help ensure that you don't miss out on any credits or deductions when you file your tax return."
Tax records should be kept for at least three years. Records or documents relating to home purchase or sale, stock transactions, tax years where no return was filed or where a fraudulent return was filed, bad debts, and important assets should be kept longer.
"[Also] if you had to pay more than you expected or received a large refund, you may want to complete a new Form W-4 withholding statement for your employer," Green said.
The withholding calculator on the IRS web site simplifies the process.
"Always be aware of what's happening with the economy as it relates to tax changes," added Simpson. "Taxes and your finances are related to each other. And your financial planning, taxes should be a part of that planning."
On the net:
Internal Revenue Service: