With tax season in full swing, it’s a prime time to get your necessary documents organized. And while it’s a smart idea to file as early as possible to quickly receive your tax refund, if you still haven’t filed yet, fear not: It’s not too late to get your documents in order and take advantage of beneficial credits and deductions. But if you’ve procrastinated this year, don’t delay any longer.
If you want to meet the April 17 deadline and dodge extra penalties and interest rates, read on to pick up some tips for last-minute filing.
[See: 7 Most-Missed Tax Deductions and Credits.]
Go to the IRS. While there’s no need to call or visit the IRS headquarters, it’s a wise idea to visit their website‘s page, “Directory of Federal Tax Return Preparers with Credentials and Selection Qualifications,” says Walter Antognini, associate professor of taxation and graduate program chair at the Lubin School of Business at Pace University in New York City.
If you type in your ZIP code, you’ll quickly get a list of tax preparers who are “recognized by the IRS as being qualified to practice before the IRS,” Antognini says.
But remember not to panic if your tax preparer doesn’t turn up in the collection of contacts the IRS provides you. There are many qualified tax return preparers who won’t be on the list, Antognini says. It’s just that the people on the IRS list will likely be the most qualified. Still, your tax preparer should at least have a preparer tax identification number or PTIN. If they don’t have this information, that’s a red flag that something is wrong.
There’s another URL on the IRS website worth checking out, says Josh Harris, a lecturer who specializes in personal finance and is on the faculty at Clemson University in Clemson, South Carolina. If you make less than $54,000, you may be eligible for free tax prep assistance, and should check out the “Get Free Tax Prep Help” page on the IRS site.
“For anyone who makes under $54,000 a year as a household, VITA, which stands for Volunteer Income Tax Assistance, offers a free service to prepare tax returns. VITA sites are run by volunteers who are trained through IRS-supported programs,” Harris says.
However, if your tax situation is complex , such as having your own business or a lot of foreign investments, Antognini says that VITA volunteers, while trained by the IRS, tend to not have high levels of experience. Still, “for the simpler returns typically prepared by a VITA location, the level of experience and knowledge is more than adequate,” he says.
Visit an AICPA or NAEA website. If you’re making more than $54,000 a year, Harris recommends utilizing these sites. “State chapters of the AICPA — American Institute of Certified Public Accountants — often run great directories where a consumer can search for someone local ahead of time and do their due diligence. The NAEA — National Association of Enrolled Agents — offer a similar search function on their website,” he says. These organizations contain a listing of reputable tax professionals; if you find one that you like, you can set up an appointment and feel confident that these pros will be able to help you with delayed filings or any tricky tax questions you may have.
[See: Answers to 7 Burning Tax Questions.]
Try LinkedIn. LinkedIn has a free service for taxpayers called LinkedIn ProFinder. Instead of searching for a tax professional in your area, you can type in your needs for a tax preparer or for any industry professional you’re looking for and explain what you want. The more information you offer about your tax situation, without providing any personal details like your Social Security number, the better and more accurate assessment a preparer can make in terms of providing you with their rates. Within 24 hours, reputable tax preparers will email you, and you can decide if you want to work with them.
Look for someone who understands the complexities of your profession. If your career is very specialized, ideally you’ll work with a tax preparer who has clients who are like you, says Bill Daknis, who lives in Fort Collins, Colorado, and owns Daknis Tax Service. For instance, Daknis says that he has developed a niche in tax preparing.
“I’ve prepared over 3,000 tax returns for clergy and ministers. Most CPAs have prepared just a handful of minister’s tax returns. Clergy tax returns are very different from normal taxpayers,” he says.
Of course, maybe your industry isn’t in the business of a religion. But that isn’t his point. You may want to be looking for someone who works on taxes in the business you’re in. “Construction company owners have different needs than a child day care provider,” he says.
And if you’re a freelancer or a contractor in the gig economy, you’d want to find a tax preparer who has worked with plenty of people in your line of work. For instance, to go with Daknis’ example of a construction company owner having different needs than a child day care provider, a child day care provider may be using his or her own home as the site of the business, which is not likely the case for a construction company owner, and may not be able to fully claim the costs for cleaning certain rooms, if he or she also uses those rooms for personal use.
Talk to friends and family. If you’re still stuck, you can always ask people you know for referrals, says Bishop Toups, a tax attorney in St. Petersburg, Florida.
“The best way to find a good, competent tax preparer [at the] last minute is to ask close friends and family members which tax preparers they use,” he says. “Oftentimes, close friends and family members will be able to recommend a good tax preparer that they have worked with for years. Another option is to reach out to your financial advisor or financial planner if you have one. A financial advisor or financial planner will usually have a tax preparer in the area that they send their own clients to.”
If you don’t get a referral, and you’re unsure of who you’re dealing with, “use your instincts,” Toups advises. For instance, if you walk into a tax preparer’s office, and it’s an utter mess, don’t fall into the trap of thinking that this professional is clearly busy and in demand. “Remember that a tax preparer handles quite a lot of sensitive information. If their office is a mess, you should be wary about hiring that tax preparer to do your taxes,” he says.
Another red flag industry experts advise you to be wary of includes when tax preparers say that they’ll charge you a percentage of your refund, since it gives them the incentive to cut corners and be dishonest to provide you with a bigger refund and forgo following tax laws.
Consider filing an extension. It’s probably not too late to find a tax preparer if you’re ahead of the April 17 deadline, but you should weigh all options, Antognini says. “In general, I would say no [it isn’t too late], but there are caveats,” he says. “I would think that most preparers are very busy by this time, and probably especially those that are more sought out. I would also think, though, that most preparers would take on new clients provided those prospective clients would be willing to go on extension. So, if a taxpayer finds a preparer they like at this juncture, they can ask if the preparer can finish the job by the unextended due date. If not, the taxpayer might consider an extension or trying to find another preparer.”
Just make sure you do file, whether your taxes or an extension, on time, Antognini warns. “Failure to file on time can result in harsh penalties plus interest,” he says.
[Read: Know How and Where to Store Your Tax Documents.]
How much of a penalty? If you fail to file your taxes on time, as a penalty, you’ll be required to pay 5 percent of your unpaid tax bill, for each month your tax bill stays unpaid after the April deadline, with the maximum capped at 25 percent . To avoid paying unnecessary penalty fees, file your return or request for an extension as soon as possible.
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Taxation Procrastination: Where to Go for Last-Minute Tax Filing Advice originally appeared on usnews.com
