Procrastination and Your Taxes

“Never put off until tomorrow what you can put off until the day after tomorrow.”     —  Mark Twain

Sound familiar? Twain was using the quote to mock some of Benjamin Franklin’s famous sayings, but it can just as easily apply to doing your taxes. Nearly one-third of Americans put off their taxes until the last minute. 

If you’re one of these types of procrastinators, there are a couple of deadlines you should know about. The first one is the most obvious, and that’s April 18th this year. Even if you won’t be able to pay your tax bill in full, you should still file. The IRS assesses two types of penalties, one for failing to pay and another for failing to file. There’s no sense in paying two penalties for one tax bill.

The next type of deadline is the extension deadline. Like the deadline for filing your taxes, the deadline for filing an extension is April 18th. Many taxpayers mistakenly think an extension means extra time to pay their tax bill. It doesn’t. An extension is designed for those who haven’t been able to gather the necessary information to properly file. If you do file an extension, the IRS still expects you to make a good faith estimate of your tax liability and to pay it by the April 18th due date.

Still procrastinating? Filing at the last minute simply increases the likelihood of errors and means you may not be able to take advantage of tax-saving opportunities like traditional IRAs. If you still want to put it off, check out this IRS site about avoiding common errors.