As tax deadline looms, here are some important reminders for last-minute filers in Ky.
It’s peak tax season. Accountants are buckling down as last-minute filers scramble in the mad dash to get in their returns by the deadline, which is April 18 when filing federally and in Kentucky.
Unfortunately, last-minute tax filers have their work cut out for them this year. Between unemployment benefits, child tax credits and stimulus payments, many forms of pandemic relief threaten to saddle filers with headaches when they fill out their returns.
Mark Steber, chief tax information officer with the tax services company Jackson Hewitt, calls this filing season “probably the most complicated” he’s seen in the last 30 years.
“The time is at hand to get your tax return done,” Steber said.
That said, there’s “no reason to panic” if you file on time and accurately, he continued. There’s also still time to file wisely and make sure you get all that you can out of your tax refund.
Here are some important reminders from the Internal Revenue Service for people filing their tax return at the last minute.
Your best bet is filing electronically
Filers who electronically prepare and file their taxes will likely have few mistakes on their return, which ultimately means it’s processed faster and any refunds can get to your bank account quicker.
You’re probably familiar with the commercial services that will help you file for a fee, but there are also options to file your taxes for free through the IRS.
You can use IRS Free File if your adjusted gross income is $73,000 or less. This service offers guided tax preparation at no cost. However, it is worth noting this will only take care of your federal return and not any state taxes you may owe.
For those comfortable filing on their own, the IRS also offers free fillable forms.
There is also qualifying tax help available for certain filers through the IRS’ Volunteer Income Tax Assistance and Tax Counseling for the Elderly programs.
How can I file my taxes electronically in Kentucky?
According to the Kentucky Department of Revenue, there are two options.
You may qualify for Kentucky’s free file program, but only if your income is $69,000 or less. If you do qualify, some free file offers may require you to file your federal and state tax return at the same time.
Your second option is the Kentucky File program. It’s similar to the federal counterpart that offers you the online version of the paper forms for free.
The trade-off here is you’ll be on your own without software help or other assistance. If that doesn’t daunt you, you can get started at the Kentucky Department of Revenue’s website.
Kentucky shares a filing date this year with the federal deadline, April 18.
Get your refund faster electronically
While you’re filing electronically, go ahead and set up your tax refund to deposit directly into your bank account. This is much faster and safer than the conventional by-mail option, according to Steber and the IRS.
Typically, you’d select this option through whatever tax software you’re using or just let your tax preparer know.
The IRS advises those who do not have a bank account to visit either the Federal Deposit Insurance Corporation’s website or the National Credit Union Administration and use its Credit Union Locator Tool. The tool helps you find a bank or credit union to open an account online.
What to know about advanced child tax credits and missed stimulus checks
According to the IRS, filers will need additional information if they want to report any advance child tax credit payments they received or stimulus checks they did not.
The IRS requires the total amount of advance child tax credit payments paid out to receive the remainder and the amount of filers third round Economic Impact Payment (stimulus check) if they want to claim the Recovery Rebate Credit.
The Recovery Rebate Credit is specifically for people who are missing a stimulus payment or got less than the full amount they were supposed to, according to the IRS.
Taxpayers should check their account or look for any letters they may have received from the IRS, including letter 6419 and letter 6475.
Go ahead and request an extension if you need it
Taxpayers have until the April deadline to request extension to file, which will give them until mid-October complete their returns.
That said, Steber underscored it’s important to note this is only an extension for filing your taxes, not paying them.
“It is not an extension of time to pay,” Steber said.
Tax filers must, at a minimum, estimate their tax liability and pay as much as they can by April 18.
Otherwise, they’ll be faced with stiff penalties and interest on the taxes they owe.
This story was originally published April 12, 2022 at 4:10 PM.