Saturday, April 7, 2012

I CAN'T PAY MY TAXES - WHAT DO I DO?

Q.  I blew it. I owe tax and don’t have any money.  What do I do?  Am I going to jail?  Should I hide?

A . The worst thing you can do is ignore the problem.  If you owe tax with your federal tax return, but can't afford to pay it all when you file, there are some things you can do to keep interest and penalties to a minimum. 
  •    File your return on time and pay as much as you can with the return. By doing this it will eliminate the late filing penalty, reduce the late payment penalty and cut down on interest charges
  • Consider obtaining a loan or paying by credit card. The interest rate and fees charged by a bank or credit card company may be lower than interest and penalties imposed by the Internal Revenue Code



IRS charges a user fee to set up your payment agreement. See
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Good luck, and start saving for 2012.  Estimated payments are due 4/15/12, 6/15/12, 9/15/12 and 1/15/13.  I would work on the 2011 first.
www.irs.gov or the installment agreement request form for fee amounts.

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