Help For Procrastinators: Last-Minute Tax Tips
April 11, 2013 12:55 p.m.
Raphael Tulino IRS spokesman for Southern California & Nevada
Related Story: Help For Procrastinators: Last-Minute Tax Tips
CAVANAUGH: This is KPBS Midday Edition. I'm Maureen Cavanaugh. This is the time tax procrastinators wait for. It's the last few days before the tax deadline of April 15th. Now, some will head to a tax preparer, some will download this year's tax software. Others will just sharpen their pencils and go at it old-school! Now matter how you plan to approach last-minute tax preparation, we have an expert on hand to give you some advice. Rafael Tulino is tax spokesman for Southern California and Nevada.
TULINO: Nice to be here.
CAVANAUGH: You're going to stick around to answer some questions from our listeners during an online chat, right?
TULINO: Yeah, sounds fun. I've done it before, and it's a real-time, lots of quick time, but glad to do it.
CAVANAUGH: Okay. Let's get an idea of how many people actually wait until the last minute to file their taxes. Are there a lot of procrastinators out there?
TULINO: Yeah, more or less. On a normal year, and this year may not be so normal, but about 30% of all returns in April. So you see a pattern of a lot of folks filing as soon as they can in January and February. You get a lull into early March, and it picks up toward the end of March and April. A lot of those folks are arguably the folks who owe. The majority of getting refunds. But you don't have to pay until April 15th. So a lot of folks are waiting till the last minute to file. Of that, you get about 25%, 20% from the last week. So the bottom line is, a lot of folks are waiting until they just have to get it done.
CAVANAUGH: You said in an average year. Is there any reason to speculate this will not be average?
TULINO: I mentioned that because it's a lot more time compressed in terms of the timeframe because the legislation we had didn't come along until after the 1st of the year, and that law as it goes, as we administer what the law provides us to administer in terms of that, we had to push back our processing beginning until January 30th. So we definitely had a late start. And certainly as we continue to go forward, all the way through April 15th and beyond throughout the rest of the year for those who take the extension and those who get processed after the 15th, it takes sometime to a few weeks to get all of these things done in terms of the returns, you're going to see probably a lot more folks who take that extension because. The timeframe this year was just a little different, out of the norm.
CAVANAUGH: It used to be a standard TV news item to have cameras at, let's say, midway post office.
TULINO: Right. It still is in certain areas!
CAVANAUGH: You'd have these lines of cars coming in, you'd interview people who were dropping off their tax forms. Oh, so glad I got it in on time! That really has changed though. Hasn't it?
TULINO: It's amazing. When I first started about 11 years ago, I went down there to take that visual down at the midway post office. And every year as the years go by, it seems to be that that is less and less because more of us are e-filing. About 90% of all returns are electronic. It's just that where we are in terms of the ease and convenience of e-filing.
CAVANAUGH: What mistakes are common with people who submit their taxes if they're really pushing it the last couple of days?
TULINO: I would argue that math errors can happen, although a computer reduces those. Transposed Social Security numbers. Maybe you're figuring taxes wrong in terms of the table you might have or the credit you have. Software really does that for you. The other thing, you might miss something through haste and panic. You don't want to panic. That's why the extension is available, which we'll touch on in a quick second. But the bottom line is, time your time and don't miss out on something out of haste that could reduce your bill and increase your refund.
CAVANAUGH: One of the biggest mistakes that can trigger an audit is forgetting to report all of your income.
>> That's true. If you're talking about those who self-report income, they tend to get a closer look. But on the other side of it, we have match documents such as your W-2s, your 1099s, and that matches up in the computer. If you miss something that we have that you didn't report, then you may get a letter in the mail, and you'll have to amend a return and then take care of it. On the other side of that, if down the road, and you mentioned something about education, we were offair, I got this education I'm paying for! I might qualify for a tax credit! I might qualify for the credit from last year! Then you file the same return and take advantage of that tax credit to increase the money coming back to you in the form of a refund.
CAVANAUGH: Any other sort of red flags if you forget or you miss the mark, that the IRS is definitely or pretty likely going to catch?
TULINO: Statistics bear out that I suppose the higher your income is, the more chance you have in terms of being looked at. And that's based on information that goes on returns that have higher incomes. But wild income swings from one year to the next, perhaps your income is X and you're deducting expenses of Y that don't kind of match up, that kind of thing? So those kinds of things that may not support the consistency of the information on your return. It depends. But there's lots of ways we go about to to make sure we're all paying our fair share.
CAVANAUGH: I want to talk to you about filing an extension. Is it hard to do? How do you go about doing it, and when do you have to do it by?
TULINO: On or before the deadline. And you want to do the extension just to provide the safety that you need. If you have a balance due, April 15th is your deadline. Amaze you may have penalties and or interest that can occur on your account. To be sure you're getting a refund, file the extension anyway, that way you protect yourself. Do pay what you owe or what you can by the 15th, that way you're in good shape for that. The extension is easy to get. Electronically, software, really simple. The form is 4868. It's a single-page form, and you fill out the bottom quarter of it, takes two minutes, send it, mail it on or before April 15th, and you have that extra time. If you have a balance due, you want to add a payment in, that way you avoid anymore. And you may see a lot of folks taking that extension this year because of the way things have worked out this year in earlies it of the tax filing season.
CAVANAUGH: And the reason you want to do that is because you face penalties if you don't file an extension and get it in by April 15th?
TULINO: Yeah, if you have a balance due and you don't file a return or an extension and make a payment, then that penalty is much greater than filing a return and then not full-paying your balance due. So filing the return is key. And I know a lot of folks in the IRS understand, thee or four years ago being more flexible, because we know more folks are in that position where they can't pay. Pay something, pay what you owe, let the agency know. We're flexible. We can work with you with a lot of different tools. Offer and compromise, and installment plans that are very easy to set up to help you.
CAVANAUGH: I said this was going to be a short conversation, and it is. We have to wrap this up right now.
CAVANAUGH: But as I mentioned before, Rafael will be staying after the show to chat online. So if you have tax questions, go to KPBS.org/chat.