Most people would agree that tax laws change on a regular basis: just when you think you understand the current policies, they are suddenly upended due to the ever-shifting political wind. Some people benefit from these changes, while others may find themselves seeking the advice of a tax attorney in San Francisco. If you are a last-minute filer, you will likely find the following information helpful:
File Faster Online
If you are filing at the last minute, don’t forget that you can file online. This can greatly lessen your stress levels, as you do not have to worry about a tax return reaching the IRS in time, as online filing is instant. Just make sure you have all your information correct and carefully proofread your return before hitting “send.”
One tax attorney mentions “filing online eliminates the post office as a middle man. You’ll be able to file almost immediately, and if you’re due a refund, you’ll usually get that quicker too”.
Filing for an Extension
If you are a last-minute filer and do not think you can realistically meet the April 15 deadline, getting an extension is easier than you might think. You can download Form 4868 from the IRS.gov website if an extension is necessary.
If you are worried about being denied, you will be happy to know that extensions are usually automatically granted and you do not have to come up with a complicated explanation regarding why you are making the request. The only requirement is that your request be submitted by midnight on April 15, 2019, for the 2018 tax year.
Elimination of Certain Write-Off Opportunities
It is also important for you to understand that under the new tax policies employees no longer have write-off opportunities. This is also true of new alimony, IRA and investment advisory fees, moving expenses, and most casualty losses. If such items are relevant to you as a taxpayer, you may see substantial tax increases. Using or setting up an owned business can significantly offset your tax bill, as it provides a way to expense applicable items. Tax attorneys can offer additional information about this strategy.
Avoiding Last Minute Mistakes
Last minute filers are at a higher risk of making mistakes than those who file well ahead of the deadline. Even simple mistakes can tie up your tax refund for weeks, such as math errors, failure to sign or date your return, or a typo in your Social Security number. Simply proofreading your return or having an accountant look it over is the best way to prevent last-minute errors.
Estate Tax
Your estate may not be taxable under the new policies, as the estate tax exemption has been doubled under the Tax Cuts and Jobs Act. It is approximately 22.4 million per married couple, and 11.2 million for single filers. Of course, this will change again in 2026, when the exemptions revert to the old levels.
Capital Gains Tax Rates
The new tax laws have not changed Capital Gains tax rates, which are still zero, 15, and 20 percent. However, it is important to keep in mind that Capital Gains rates are determined by regular income rates. This means that having sufficient employment, interest, business, or other ordinary income increases the effective Capital Gains rate.
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