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The Tax Extension Countdown to October 15, 2009

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By Neetal Parekh on September 24, 2009 1:00 PM

If you waved the tax collectors by last April by filling a Form 4868 extension, you should know they will be coming by again on October 15th.  The six-month automatic extension comes due in just a few weeks. 

Here are a few things to keep in mind:

  • You have to pay interest on any 2008 tax that was not paid by April 15, 2009

What if you still can't pay your taxes?

  • If you can't pay taxes by October 15, 2009, you should return and attach Form 9465 to request an installment arrangement.
  • Installment agreements allow taxpayers to make series of monthly payments over time.
  • There is a one-time installment agreement fee of $105.  Additional changes to the agreement will cost you $45.
  • You can pay the balance off earlier than the time agreed upon without penalty.
  • Base your monthly payment amount by what you are able to pay regularly without defaulting.
  • Payments can be made by:
    • direct debit from a bank account (and additional fee may apply)
    • payroll deduction (employer must fill out Form 2159)
    • money order
    • credit card (by phone or through the internet)
    • Online Payment Agreement (OPA)
    • Electronic Federal Tax Payment System (EFTPS)

What if you don't file a return?

  • The IRS will assess penalties, that will increase the total amount you owe.
  • The IRS will file a substitute return on your behalf.  It will not include any exemptions or expenses you might be entitled to.
  • Once the substitute return is filed, the IRS will initiate collection procedures which may include a federal tax lien against property, levy on wages or bank accounts.

There are still a few weeks to file your taxes or set up an installment agreement.  Don't let the deadline pass you by!  You can find more information on 2009 taxes, tips and income tax rules and forms at the FindLaw 2009 Tax Center.

 

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