Question: Between a couple of business trips and some illness in the family, there's no way I can make the April 15 deadline for filing my income tax return. Is the IRS as tough as people say? Or will they listen to reason and let me file a little later ?
Answer: The IRS really isn't an impersonal orge waiting to pounce on an innocent taxpayer. The service consists of a bunch of ordinary people trying to do an often thankless job.
(Contary to what some readers think, I've never worked for or been assocated in any way with the IRS.)
On the subject of late filing, the IRS is really a soft touch. You can get a 60-day filing extension without even having to provide a reason or justify the request. Approval is automatic and assumed without any reponse by the IRS.
To take advantage of this extension provision, you must do three things:
File a completed Form 4868 (application for automatic extension) no later than April 15 with the service center where you normally file your tax return.
Make a rough estimate of your final tax liability, and forward payment of any estimated balance due along with Form 4868.
File your completed tax return no later than June 16. (The 15th falls on Sunday.) Attach a copy of the Form 4868 to the return.
Q: While working on my 1979 tax return I suddenly realized that I had forgotten to take a deduction on the 1978 return for Virginia personal property tax. Can I add the 1978 payment to 1979's and claim the total this year? Or is it a lost cause ?
A: The answer is "no" to both questions. If you made a mistake on your 1978 return, it isn't a lost cause. You can correct an error any time within three years after the due date of the orginal return. That rule gives you until April 15, 1982 to amend your 1978 tax return.
But you don't do it by altering the numbers on your current return. Instead, file IRS Form 1040X on which you enter both the original and correct figures and then compute the resulting change in tax liability.
You must also explain the reason for the admendment. The IRS is not really interested in details -- they just want the basic facts. In your case, for example, it is enough to note, "State personal property tax of XX paid in 1978 inadvertently omitted from Schedule A."
If the correction results in a reduction of your original tax liability -- as in this case -- the IRS will send you a check for the balance due along with the Form 1040X.
Don't forget that you are required to file an amendment to your state tax return when you correct your federal return.
Some tax consultants will tell you that submission of an amended return will make you more vulnerable to an audit. This has not been my experience; I don't believe exposure is any greater unless the amendment itself is based on a questionable item.
Tax calandar: April 15 is more than just the last day for filing your 1979 income tax return or -- as explained above -- for requesting an extension.
Having finally gotten your 1979 taxes out of the way, many of you must turn immediately to 1980, for April 15 is also the due date for filing a declaration for estimated tax for this year. Along with yform 1040-ES, you must send the first quarterly installment of your estimated tax deficiency.
April 15 is also the last day for making a payment into an existing Keogh plan on behalf of 1979 earnings from self-employment. If you were eligible for an IRA for 1979, you have until tomorrow to open an account and deposit funds in time to claim credit on your 1979 tax return.