And in my opinion the best one is… Don’t make it all about YOU. Enjoy!
Individual income tax returns are due on April 17, 2012 (tomorrow). If you need to file an extension to file your tax returns, you can do so by completing Form 4868 http://www.irs.gov/pub/irs-pdf/f4868.pdf – or online at any free third-party IRS approved vendor site http://apps.irs.gov/app/freeFile/jsp/index.jsp?ck. This is an extension to file your income tax returns… it is NOT an extension to PAY your income tax returns.
The IRS announced last month it’s Fresh Start initiative program. One part of this program offers relief to certain taxpayers in PAYING their taxes. To be eligible for this, you must have either 1) been unemployed for at least 30 days in 2011 and/or through April 15, 2012.. OR 2) been self-employed and had a 25% decrease in revenue (relative to 2010) due to the economic downturn. If you fall into one of these categories you can file Form 1127-A http://www.irs.gov/pub/irs-pdf/f1127a.pdf to request a six month extension to pay your taxes (only eligible if owing under $50k in taxes). As long as your taxes are paid by October 15, 2012 this program gives the taxpayer an extension to pay their taxes without the 5% per month late filing penalty. Interest charges will still apply.
Remember, if you also need an extension to FILE your taxes, make sure your Form 4868 is also sent in by April 17, 2010.
NO making work pay credit for your 2011 tax return and NO stimulus checks for 2011 tax year.
Important information for tax preparers and firms.
Elizabeth asks question regarding deductions listed on Form 1098 vs. Settlement Statement HUD1:
“My brother and sister in law bought and sold a house in October…..only one real estate tax payment is on the 1098’s…..but I know you can read the settlement papers and sometimes those items like PMI are on there instead….the problem is I can’t understand it because it looks both the seller and buyer paid taxes there…..I don’t want to miss a deduction for them and I’m done the entire return except for that.”
Elizabeth, if your only question is regarding the taxes, you should go to Maryland property tax assessments at http://sdatcert3.resiusa.org/rp_rewrite/ . Type in the county and the street address. It will pull up the full amount of taxes for the year on the property. If the seller’s side of the HUD1 shows their portion, you can simply deduct the full annual amount from what the seller paid on the HUD1 to determine your brother’s portion of the deduction. Real estate taxes in Maryland are paid semi-annually so it is very possible that they both paid a portion of the taxes.
Otherwise, if you want me to peek at it, let me know and I’ll take a look. I would need to see the Form 1098 and the HUD1 Settlement Statements. Usually the 1098 picks up the interest that is included on the Settlement Statement…. But there have many cases where they miss a small portion (especially if the bank sells the loan during the year). If you want me to look you can fax it, scan it, email it, or we could even Skype it or scan a pic of the docs with your phone. I also have a secure document server you can upload to online.
I have a great cheat sheet I will send to you. It has a sample HUD1 and on each column I have written in what is considered BASIS (for when they sell the property) and what is an EXPENSE that can be written off in the year of the sale. Unfortunately, it’s an old paper copy and not with me while I’m out of town.
Let me know if I can help further!