The clock is ticking for taxpayers. There's just a little more than a month to go before the April 17 filing deadline. If you haven't finished your return yet, you may be able to cut your tax prep bill and even your risk for audits. Kelli Grant, Senior Consumer Reporter for SmartMoney.com, tells you how.
Hunt for discounts. If you're using tax preparation software, do a search for coupon codes. Start with your bank. Citibank customers, for example, may spot links in their online accounts leading to a 35% discount on TurboTax. Other financial institutions are sending out coupons via email. Sites like CouponShack.com also list codes offering up to 50% off preparation sites.
Watch out for unexpected fees. Some states are now including penalties for preparing a return with software but filing it by mail. In New York, for example, there's a $20 fee for not e-filing an electronically prepared return. Paying taxes owed with a credit card also incurs a processing fee of up to 3%, adding to your bill. It's better to mail a check.
Asses free filing options. Consumers making $57,000 or less may be eligible for free tax filing through the IRS Free File program. By the government's estimates, that's 70% of taxpayers. Some groups will even help you prepare your return for free. Check out irs.gov for details.
Check into "relief" options. The IRS now offers taxpayers who were unemployed for at least 30 consecutive days in 2011 a little extra time to pay. They have until October 15 instead of April 17 to pay taxes owed, without worrying about penalties. But it's only available to individuals making less than $100,000; couples, less than $200,000. And you'll need to file an extra form, 1127A, to claim relief.
You can explain yourself out of an audit. One of the biggest red flags for an audit is a return that doesn't quite match up with what you've filed in previous years. The IRS is wary of returns with larger-than-usual charitable contributions, for example, or other big deductions. You can often head off an audit by including an explanatory note. Maybe a relative passed away two years ago, but you're just now getting around to donating his or her wardrobe.
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