Yes, It's Tax Time
The evil day is at hand. Procrastinating taxpayers have until midnight to file their forms with the Internal Revenue Service.
President Bush is getting into the spirit of the day with a speech at a U.S. Chamber of Commerce tax cut rally in Washington. Mr. Bush will be putting in another plug for his tax cut and budget proposals.
The tax agency is advising taxpayers to take time to double-check their math and take care to use the correct tax amount from the tax table. Another way to save possible headaches later is to correctly list Social Security numbers, including those for dependents.
But don't get the idea that everybody is suffering. The IRS has virtually given up trying to go after more than a million tax delinquents — a move that effectively wrote off more than $2.5 billion owed to the government last year alone. And tax return audits by the IRS dropped more that 50 percent last year. Staff cuts and slender budgets are cited as the cause.
Nevertheless, IRS spokesman Don Roberts estimated that some 37 million tax returns would be filed in the final two weeks before the deadline — 11 million last week and 26 million postmarked or electronically filed on the deadline day of Monday. In all, about 130 million individual returns are expected this year.
Residents of New England and upstate New York will have a day's grace thanks to the Patriot's Day holiday in Massachusetts, home to an IRS processing center that handles their returns.
Many post offices will be open until midnight to put a Monday cancellation mark on last-minute returns. The IRS accepts a postmark as proof the return was filed on time.
Taxpayers can request an automatic four-month extension for filing returns, but they must pay any estimated taxes on time. Otherwise, the IRS will assess a late-payment penalty and interest, currently running at 8 percent.
Extensions can be obtained by phone by calling (888) 796-1074 — some information from the 1999 return is needed to verify identity or with Form 4868.
For people facing a big tax bill they cannot pay all at once, the IRS offers several options. One is credit-card payment through one of the two toll-free numbers: (888) ALL-TAXX or (800) 2PAYTAX.
The call is free, but the companies that run the services for the IRS collect a "convenience fee" for the transaction. The IRS points out that it gets none of this money, nor does it collect and store credit-card numbers.
The IRS also will most likely approve a request for an installment payment plan if the taxpayer owes less than $25,000 and can pay within a five-year period. To obtain such a plan, attach Form 9465 to the front of the return; there is a $43 fee to set up an installment plan, which carries 8 percent interest and a penalty of 0.25 percent per month once it is approved by the IRS.
(c) MMI Viacom Internet Services Inc. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. The Associated Press contributed to this report