It's not just any Monday, it's May 15th. State income taxes are due today.
If the date snuck up on you, and you haven't prepared your income taxes, WWL talked with a CPA and tax attorney who offers some advice to you.
Cherish Van Mullem says you can get an automatic extension on your state taxes.
"It used to be you filed for an extension and you got a six month extension, but now you get an automatic extension," Van Mullem explains. "And it's only automatic if you actually file on the day it's due, November 15th."
Suppose you're short of money and you can't pay your taxes starting today.
"Payment is due May 15th regardless. If you don't pay by May 15th, you can make a good faith payment for what you can pay," Van Mullem says. "And then work out with the Department [of Revenue] what you'll be able to pay over time, and the Department generally doesn't want to pay overtime for more than six months."
Now is not the time to think you can just ignore it and it will go away. Van Mullem says you need to take charge of the matter, that way the state will negotiate seriously with you about helping meet your burden over time.
"If you do not pay by the 15th you will have penalties and interest, regardless of whether you work out a deal with the state or not," Van Mullem points out. "You are going to have [to pay] interest, sometimes the penalties can be reduced by working out a plan with the state."
Van Mullem reiterates it is in your interest to make some kind of good faith payment today when the taxes are due so the state knows you're dealing with them above board.
As for retiring that debt to the state, Van Mullem recommends...
"It's a lot cheaper to borrow money from a bank, or your credit cards than it is to borrow it from the feds or the state for taxes. So do what you can to get those payments made on time."
To recap:
· Make a payment today to show the state you're operating in good faith and to get the automatic six-month extension.
· Work out a payment plan with the state to have your tax burden paid off by the time the extension expires.
· Make sure you make those payments so your extension stays in place and the state isn't hitting you with expensive penalties and interest.
· If you have to, borrow money from a bank, or (if you can) put the payments on your credit card—as Van Mullem says it will be cheaper to pay it off than get snagged in penalties and interest fees from the state.