Tax Tip of the Week
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What to do if you missed the April 16 filing deadline
For the week of
May 14, 2001
Whether you owe the IRS money or the IRS owes you, don't stick your head in the
sand when it comes to filing your income tax return.
According to the Tax Foundation, the average American taxpayer must work until May 3, 2001, to earn enough money
to pay the federal, state, and local taxes he'll owe for 2001. If you missed the filing deadline for your 2000
return and you owe the IRS money, you'll most likely have to work longer than the average taxpayer to pay your
taxes. Here's why.
If you failed to pay all your 2000 taxes by April 16th, 2001, you'll have to pay the IRS interest and penalties
on your underpayment. But when you file a late return with a balance due, another nasty penalty kicks in – the late filing penalty. This penalty amounts to 5% per
month, for a maximum of five months. For example, if you owe $5,000 and failed to file a return or an extension
by April 16, 2001, the failure-to-file penalty could be as much as 25% or $1,250.
If the IRS owes you money, it won't penalize you for filing late. But you'll delay your opportunity to invest your
refund or perhaps pay down your high-interest credit card debt.
Let us help you get your return in the mail, so that you can get a load off your mind and keep your penalties and
interest to a minimum. Give us a call.
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"Tax Tips" are published weekly to
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and current tax information.
The information contained in this site is of a general nature and should not be acted upon in your specific situation
without further details and/or professional assistance.
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