Tax Tip: Don't Be Late

Tax Tip: Don't Be Late

NEW YORK (MainStreet) — T-Day has arrived!

Today is the deadline for filing your 2010 federal and state income tax returns.  The envelopes must be postmarked by midnight tonight. But if you haven’t prepared your return yet, do not worry – all is not lost.

You can file a Form 4868 to request a six month extension, until October 15, to file your 2010 return. Form 4868 (available at the IRS website) also must be postmarked by midnight tonight. In most cases filing a federal extension request will also extend your state return.

I must point out that the extension is for time to file your tax return – it is not an extension of time to pay your tax. Uncle Sam will charge you interest, and a small penalty, from April 18 until your tax is paid in full. If you think you will owe the IRS you should include a check with Form 4868.

What if you don’t have the money to pay the tax you owe? It is very important that you get your tax return, or extension request, in the mail today – even if you cannot pay all, or any, of the tax due. Send what you can with the return – but if you can’t send anything be sure to mail the return anyway.

The IRS penalty for paying late is 0.5% (one half of one percent) of the tax due per month, or part thereof, until paid. The penalty for filing late, though, is 5% per month – that's 10 times as much and just not worth it, so get to your local post office before it closes today!