Get an extension if you can't file on time
April 18 is the due date for filing your 2010 tax return. If you won't have all your tax information assembled in time to meet the filing deadline, getting an extension will give you an extra six months - or until October 17, 2011 - to file your return.
Over the years, the IRS has made requesting an extension easier. The extension is automatic; you simply have to file Form 4868 with the IRS by the April 18 filing deadline. Be aware, however, that an extension to file does not extend your time to pay. The IRS will still assess interest on any unpaid tax balance. In addition, unless you pay at least 90% of your estimated tax liability by April 18, you may be hit with a late-payment penalty.
If you are a U.S. citizen living abroad, you have until June 15, 2011, to file your 2010 return. This does not require the filing of an extension form. This two-month extension does not apply to taxpayers who are just traveling outside the U.S. on April 18. When you file your tax return, you must attach a statement showing that you qualified for the extension. If additional time beyond June 15 is needed, Form 2350 should be filed to obtain an automatic extension until October 17, 2011. Interest will be calculated on any balance due from the April 18 due date.
Military personnel serving in combat qualify for an extension for filing returns and paying tax for the period of combat service plus 180 days.
For additional information or filing assistance, contact our office.
Check your withholding and estimated tax payments for 2011
If you expect a large tax refund this year, or if you've already received one, chances are you're happy. But why give the government an interest-free loan? Why not keep more of your money and invest it throughout the year for your own benefit? Whether you pay your taxes through withholding or you make quarterly estimated tax payments, you can take steps now to ensure that you don't receive a large refund on your 2011 taxes - and that you won't owe a lot of money either.
Your tax bill for 2011 could vary from your 2010 taxes for many reasons. If your spouse or you get a new job or leave a job this year, your income may change. Perhaps your eligibility for the various tax credits, exemptions, and deductions that are available will change this year. If your income decreases or if you can take advantage of any of the tax breaks to reduce your taxes, you may be able to lower your tax withholding or quarterly payments and put more money in your pocket now. The opposite is true if your income rises or you lose eligibility for a deduction, exemption, or credit. In that case, you may have to increase your withholding or quarterly tax payments.
To adjust your withholding for 2011, ask your employer for a new Form W-4, and take the time to complete it carefully.
If you make quarterly tax payments, you should be aware of the safe harbor rules that will let you make the lowest required payments without subjecting yourself to possible penalty charges. The rule that fits most taxpayers is the one that calculates your 2011 quarterly estimated payments based on your 2010 tax liability.
For help in determining your correct withholding or estimated tax payments, contact our office. by phone at 408-879-9990 or by email at cpa@cpasllp.comwww.cpasllp.com for more details. for more details. You can also visit our website
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