Getting ready to prepare your income tax return? Here are some tips from the IRS: If you are getting a refund, consider direct deposit. It is more secure, since it eliminates the possibility of your refund check being lost in the mail. Thousands of checks are returned to the IRS every year as undeliverable. Just follow the instructions on your return or in your tax software. Be sure your account number and bank routing number are correct. You can even deposit your refund into several accounts, and you can purchase savings bonds. You will need to fill out Form 8888 to select multiple deposits.
RumboughBefore you file your return either electronically or by mail, be sure to check it thoroughly for errors. One of the most common errors is a wrong social security number. Other common errors are having the wrong address and forgetting to sign the return.
Make sure you have received everything you need to prepare your return completely. Generally, companies that report tax information to you should have it in the mail to you by Jan. 31. Sometimes there may be a delay. You don’t want to have to file an amended return because you left off a significant piece of information. Your best guide to making sure you have everything is last year’s tax return.
If you are the beneficiary of a trust, remember that the tax information you have to report from the trust comes from its own tax return, which isn’t due until April 15. Therefore, you may not get information from that trust until after April 15. If this is the case for you, be sure to file for an extension of time to file your return. You will still need to pay the tax due by April 15 (or a good estimate), but you will have until Aug. 15 to actually file your return.
If you think you will owe money this year, be sure to at least complete your return early. You can always wait until April 15 to file it, but you will at least know exactly how much you owe, and have time to save for it. Oh, and by the way, this year, the tax return deadline is actually April 17, so you get two more days!
– Rumbough, CPA, CFP, is chief operations officer with the Baptist Foundation of South Carolina. Contact her at 800-723-7242. In accordance with IRS Circular 230, any U.S. federal tax advice contained in this communication is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing, or recommending to another party any transaction or matter addressed herein.