IRS Offers Tips to Taxpayers as April 18 Filing Deadline Nears

The IRS offered some filing tips as the final countdown begins:

• Many tax credits from the American Recovery and Reinvestment Act are available. These include an expanded American Opportunity Credit of up to $2,500 for tuition, books and fees; a larger energy credit of up to $1,500 and an expanded Earned Income Tax Credit for larger families of up to $5,666. As well, the $8,000 first-time homebuyer credit is still available for people who entered into a binding contract by April 30, 2010, and went to settlement by September 30, 2010.
• IRS Free File, brand-name software or online fillable forms, is a simple way to prepare and e-file returns. There is no charge. Software is available to the 70% of taxpayers who earn $58,000 or less. And fillable forms have no income limitations.
• Filing electronically gets a faster refund, provides secure, encrypted transmission and results in a more accurate tax return. Taxpayers can e-file through a tax preparer, through commercial software or through IRS Free File.
• Taxpayers who cannot meet the April 18 deadline can file an extension, using Form 4868, Application for Automatic Extension of Time to File U.S. Individual Income Tax Return. All taxpayers can use Free File to submit a Form 4868 for an automatic six-month extension. And Free File will be available through the October 17 extension deadline for late filers.
• The six-month extension is to file a return only; it is not an extension to pay taxes due. Those unable to pay their taxes should file a tax return anyway to lessen the penalties and pay as much as they can. Then they can work with the IRS to set up a payment plan or use the Online Payment Agreement Application.

Besides Free File, the IRS offers other free tax help services through volunteers at nationwide sites. The Volunteer Income Tax Assistance sites serve taxpayers whose 2010 incomes were $49,000 or less. Tax Counseling for the Elderly sites serve taxpayers who are 60 and older.