Monday, April 11, 2011

Extension please!

Tax Tip:  As mentioned in my last post, now is the time to file your extension. Waiting until next weekend is likely to be a disaster as the IRS servers will be totally overloaded. Note, the IRS Extension Form 4868 line 4 is where you need to estimate your total tax liability for 2010. Line 5 is for the payments made (this includes your withholding) and line 6 is for the balance due, if any, and finally, line 7 the amount you are paying.

Note in the past, if your estimate was more than 10% off, it rendered your extension almost worthless! Trust me on this, that last hour of effort can yield tremendous differences! I strongly suggest any tax due should be paid online to avoid late payment penalties.

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