RICHMOND, Va. - Monday, April 18 is a day most Americans have been dreading — Tax Day.
This year's filing is more complicated following child tax credits and stimulus checks coming last year, according to tax experts.
As of April 1, about 70 million people had still not filed. A Jackson-Hewitt survey conducted last month found 21% of respondents who waited to file are "too confused" about their personal tax situation, and 15% thought the deadline would be pushed back again.
On top of the confusion, the IRS recently acknowledged they’re short staffed,and only about 20% of callers have been getting through to live agents this month.
Darin Branch, the founder and CEO of Whitewood Tax Solutions in Chesterfield, said if you haven't yet filed, don’t panic, but he notes you should really consider filing an extension Monday to give yourself more time.
"If you're waiting till Monday, the odds of you, you know, having all your stuff together, I mean, I hate to say it, but it's probably slim," Branch explained. "So just relax, file an extension, you know, let somebody pull your records, get your records together, and file it. Now make sure you file it before October, but you know, get your extension in so that you can actually kind of relax and recoup and gather all your information."
Because of the child tax credits and stimulus checks, Branch said many people don’t have all of their paperwork together, meaning important information could likely be missed, which would impact what you owe or how much money you get back in a refund.
"File an extension, and let's let's get it done right this time because there's so many tax breaks, tax credits and things you can get this year that you're not used to getting," said Branch.
If you plan to ask for an extension, you’ll need to fill out a one-page form that asks for basic information and asks you to estimate how much you owe in taxes.
If you owe the IRS, you still technically need to pay that money by April 18.
Branch said it’s best to make an estimate and pay what you owed last year to try to reduce the penalties you could incur for not paying Monday.
For example, if you think that you owe $10,000 but end up actually owing $11,000, you'll be charged an underpayment penalty. But you'll only have to pay a penalty on $1,000 rather than the entire $11,000 that you owe.
"If you had roughly the same amount of income, you can pay what you paid last year, what you owed last year," Branch explained. "A lot of people...also think they've got to file when they get refunds. And that's something you have three years to claim a refund. So I mean, you don't have to rush to file to get your refund, especially if you're getting a refund, you want to make sure you get the maximum refund you can get."
If you typically receive a refund and believe the IRS owes you money, you don’t have to file an extension or pay anything by the April 18 deadline. But if your calculations are wrong, you could have to pay late fees on the money you do owe.
Once you file your taxes, you can expect to receive that refund about three weeks later.
This year's average refund is more than $3,200, according to the latest IRS data.