LAS VEGAS (KTNV) — The deadline to file taxes is Monday, April 18, but this tax season, there are some costly mistakes to avoid.
In an interview with a local financial professional, Brad Zucker from SMA Wealth Management, he shares money-saving tips for last-minute filers.
Q: WHAT TAX CHANGES SHOULD WE PAY ATTENTION TO WHEN FILING?
- Anyone who received the child tax credit payments in 2021 can not claim the child credit on your 2021 taxes because you’ve already received the money. If you made more money in 2021 and no longer qualify for the credit, you may have to pay back some of the money you've already received.
- Pay attention to the standard deduction for 2021 tax returns. For married couples filing jointly, the standard deduction has increased to $25,100, while the deduction for single taxpayers and couples filing separately increased to $12,550.
- Make sure to check which tax bracket you fall into this tax season because the IRS adjusts the tax brackets each year to account for inflation.
- Finally, if you’re charitably minded, the Taxpayer Certainty and Disaster Tax Relief Act allows for a charitable contribution deduction up to $300 or $600 for married individuals filing jointly.
Q: WHAT SHOULD WE DO IF WE CAN’T MAKE THE FILING DEADLINE?
- You can still file after the deadline, as long as you have a file extension.
- Unlike the previous two years, the tax deadline was not extended due to the pandemic, but some still may need extra time to prepare their taxes.
- An extension will give you until October 17th to file. I have a link to the extension form on my website, askbradzucker.com.
Q: WHAT MISTAKES SHOULD WE BE CAREFUL TO AVOID?
Double Fees
- The IRS charges penalty fees for filing late or submitting a payment late.
- If you can’t get all of your paperwork together by the deadline, an extension will give you an extra six months to file.
- Even if you file for an extension, you can still get hit with a late payment fee if you owe money on your taxes.
- Make your best estimate because you still need to pay by April 18. Then, make sure you get your return filed by October 15.
Paper Filing
- Last-minute filers should avoid paper filing.
- Many of the centers that process paper claims have closed due to the pandemic, which will make your return process even slower.
- Paper filing leaves more room for human error, as well. Double and triple-check your return if you paper file because any mistake can trigger a manual review, which will slow things down even more.
- Filing electronically, and choosing direct deposit, for your return is the best way to avoid unnecessary mistakes and further refund delays.
- And if your 2021 income was under $73,000, you can file your return online for free using the IRS Free File program.
Overpaying
- When filers rush to submit their tax forms, they miss out on money-saving strategies.
- One way to lower your tax bill is by increasing your retirement savings.
- The money you contribute to a 401(k) or IRA is not considered taxable income and reduces your tax liability, even if you take the standard deduction.
- You can contribute money to your retirement accounts until April 18th for your 2021 taxes.
- Younger workers are capped at saving $6,000 in their IRAs for 2022. But workers 50 and older can put $7,000 into an IRA.
- Whether you are young and just starting out in your career or 5-10 years away from retirement, the goal is to preserve your wealth, grow money with little to no risk, create tax-advantaged lifetime income, and to provide a legacy after death.
