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If you are hesitating to file your taxes, you are not alone. Many in Missouri and across the country are feeling the sting of completing their tax returns only to discover they owe the IRS thousands of dollars more than in previous years. The recent tax changes may have affected the amount of taxes withheld from your paycheck. While you may have noticed a slight increase in your weekly check, the result is a larger tax bill, perhaps one you cannot afford.
Like many who suddenly find themselves facing a financial crisis, your shockingly high tax bill may cause you to want to hide under the blankets and hope it all goes away. However, this will only make matters worse. Instead, your first step may be to seek as much information as possible about your options.
Do this, not that
Apparently, it is not unusual for taxpayers this year to see their bills increase by thousands of dollars. A combination of factors is causing this, including the loss of deductions and tax credits, and increases in taxable income for some. If your tax bill is higher than you can manage, you may be unsure what to do. Tax advisors recommend taking the following steps:
- Complete your tax returns and file on time. The last thing you want is for the IRS to add more penalties to an already hefty bill.
- Even if you request an extension, remember that the IRS expects you to pay by the deadline. The extension applies only to your filing date.
- Send the IRS as much as you can afford. The IRS will accept a partial payment, and this may help you keep any penalties or interest low.
- Investigate the plans the IRS offers for repaying taxes. You may qualify for an installment plan that breaks your tax bill into monthly payments.
- Avoid any flashy organizations that promise to reduce or eliminate your tax debt. You may end up the victim of a scam that will cost you even more money.
- Don’t be afraid to contact the IRS for advice and information about your bill.
Of course, there may be other options available for your special circumstances. As confusing and ever changing at federal taxes can be, you would be wise to seek advice from a professional who understands the new tax laws. With the right information and guidance, you may find there is no need to panic after all.