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5 Tax Tips You Should Know

By
Laura Adams, MBA,

 

Quick Tip: 5 Important Tax Tips You Should Know

Tax Tip #1: If you haven't heard, the IRS is going digital this year-no more paper tax packages will be mailed to individuals or businesses, hip, hip, hooray! If you're nostalgic for the old-school forms (or just need kindling for your fireplace) you can still get them at local IRS offices, the IRS Web site, or at participating post offices and libraries. Visit www.irs.gov/freefile to review all your electronic filing options.

Tax Tip #2: The deadline to file 2010 federal taxes has been extended to Monday, April 18 because the Emancipation Day holiday falls on April 15 this year. Even though you have 3 extra days to file, don't wait until the last minute! It's a smart move to begin gathering tax-related documents as soon as possible.

Tax Tip #3: If you request an extension of time to file 2010 taxes (using Form 4868), you'll have until October 17--but remember there's no such thing as an extension of time to pay taxes. If you owe taxes, the IRS will expect your prompt payment no later than April 18.

Tax Tip #4: Even though you should start getting ready for tax day, you shouldn't file taxes too early this year! The IRS is scrambling due to last-minute changes made to the tax law in December 2010 and they need more time to reprogram their computer systems. If you itemize your tax deductions or will claim deductions for education expenses, don't file a paper or electronic tax return before mid-February (a specific date will be forthcoming from the IRS).

Tax Tip #5: If the above tip doesn't apply to you, the IRS will take your e-file and Free File tax return as early as January 14. E-file is the fastest and safest way to get a tax refund.

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