Still Not Done With Your Taxes? Here's 8 Crucial Tips for Last-Minute E-Filers

Are you going to be late filing taxes? You might be if you follow the dates from the last couple of years. Traditionally, in the United States, you are supposed to file your federal income taxes by April 15. And that's the rule this year, for the first time in a while, since the 15th isn't falling on a weekend.

Nor is it being held up by the legal holiday in the District of Columbia on the 16th called Emancipation Day, which commemorates the end of slavery in the district in 1862.

Some states give a little extra time for the state taxes. But even those state residents have to file federal taxes by Monday the 15th. State tax deadlines after the 15th this year include:

• April 17: Massachusetts and Maine

• April 20: Oklahoma (but only for e-returns)

• April 22: Hawaii

• April 30: New Mexico (only for e-returns), Delaware, and Iowa

• May 1: Virginia

• May 15: Louisiana

You also may earn an extension if you live in a place that has experienced a recent natural disaster.

If you live in Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, or Wyoming, you don't have to worry about state income tax at all.

Gather Your Documentation

Most tax documents, such as W-2s and 1099s, should have been mailed to you with a postmark of Jan. 31, 2024, though there might be a few exceptions, including 1099-S and 1099-B forms.

Don't file until you're sure you've got all the forms you need. Lacking paperwork can put a bigger target on you for an audit. It also means more work later to file an amendment (Form 1040-X). You've got three years from the original filing date to file an amendment to get a refund. 1040-X is available to file electronically via your favorite tax software, but only if you e-filed your original return. Rather than file without the right papers, it's better to file an extension (see below).

Worried about a missing W-2 or 1099? Take a look at your full IRS transcript—that's a list of all the income and wage information that was reported for you over the year. You'll find it on the IRS page called Get Your Tax Record. You'll need to provide your Social Security number or Individual Tax Identification Number (ITIN), date of birth, filing status, and street address for an online transcript that's suitable for printing.

Avoid the Scams

In 2015, there was a huge spike in refund theft—1.2 million fraudulent returns were filed, totaling $7.2 billion. The IRS and states, to crack down on tax-refund fraud, began delaying refunds to verify IDs. That's become the norm, especially for those getting the Earned Income Tax Credit or Child Tax Credit. Fraudsters love these refundable tax credits, because even low-income filers qualify. The other reason refunds can be late is low staffing at the IRS. However, they supposedly hired 5,000 customer service agents in 2022, and put the call out for 3,700 more in 2023. That will help.

The IRS will accept only one return per Social Security number, so filing early means beating fraudsters to the punch. Getting a rejection on an e-filed return this late in the season is the first sign your ID may be compromised. Fixing that issue can be a true hassle. You'll have to start with a fraud report. (To stay safe, use tax filing software, log in with a unique username and a strong password, then activate multi-factor authentication to lock it all down.)

The IRS fraud filters are stringent, catching even legit filers in their claws. In 2015, 40% of the 4.8 million flagged by the IRS as fraudulent were not. But by the end of 2018, fraud was down 72%, according to the IRS. It issues a criminal investigation report annually.

All of this means if it takes a while to get your refund, it may be for a good reason.

Take a look at the latest list for 2023 of "Dirty Dozen" top tax scams from the IRS; the list changes a bit every year. Among the top problems last year were fake charities, unscrupulous tax return preparers, fraudulent advice on social media, spearphishing at tax pros, and phishing/smishing overall for taxpayers.

If you think you've been the victim of one of them, call the IRS at 800-829-1040 for individuals, or 800-829-4933 for businesses, and explain what happened

IRS Contact Preferences

The IRS has rules about contacting citizens, starting with this prime directive: The IRS will never call you to demand immediate payment. It certainly won't ask for a credit or debit card number over the phone. It would never ask for a gift card or wire transfer. With the IRS, the first point of contact is snail mail.

Just to reiterate: The IRS always prefers postal mail. If you get an email from the IRS, it is 100% a scam. Especially if it has an attachment. Forward those emails to [email protected] or call the numbers above.

Sometimes, rarely, the IRS might call you. If you get a suspicious call, report it on the Treasury Inspector General's Report a Crime form, or call 800-366-4484. (You can also use that number to report IRS employees who mistreat you.)

Curious about what a scam call sounds like? Listen to a sample IRS phone scam call recording.

Hassle-Free Filing Via Top Tax-Prep Software

Filing your taxes doesn't need to be a hassle. Today's tax preparation software painlessly takes you through the steps to file a clean, correct return. The software saves your work as you go; you can start before you get all your tax documents and go back in later.

E-filing—using software on your PC or phone—is the way to go. (If you don't believe me, read How to Get the Largest Tax Refund Possible.) The IRS prefers it. It won't take long to get your refund. The College Investor created this chart to show how long the wait should be, depending on when you file, and if you want a direct deposit or a paper check.

There are both big and small names in online tax preparation software, but this year, Intuit TurboTax, H&R Block, and FreeTaxUSA all take home PCMag's Editors' Choice awards. FreeTaxUSA and TurboTax also took home our Readers' Choice awards.

These services range in price. Many have free versions for federal filing, which turn into premium packages that include state filing and advanced scenarios (such as having a home business). Each offers a variety of ways to claim refunds, recommendations to avoid an audit, and some form of an accuracy guarantee.

If you prefer to file on your phone, check out the Best Mobile Tax Apps, where the same names earn Editors' Choice awards again.

If you're a freelancer, especially working in the gig economy ruled by apps, read When Side Hustle Meets Schedule C: What Gig Workers Should Know About Taxes.

Extensions, Penalties, and When to Pay

When you know you're owed a federal refund, you are "allowed" to file late, even after April 15. In fact, the government would appreciate it if citizens getting a refund did file late. It likes to hold onto money. If you wait too long—three years—your refund becomes government property.

This does not apply to states, however. You must file state taxes on time, whether you're paying or not.

For those who fear electronic filing, some USPS offices will likely be open until midnight on Monday, April 15—and your mailing must have an 11:59:59 p.m. postmark or earlier, or you're late. Use the USPS.com Locations tool to find the office nearest to you that will be open; call to make sure. Even if you file by then, if the return gets lost, you're going to be considered late and get penalized. Use certified or registered mail to track the mailing and give yourself some backup. (And maybe file for the extension online, just in case.)

If you don't file by April 15 (not even an extension), but you owe money, the monetary penalties are 5% of any unpaid taxes owed for each month you don't file, up to 25% of the total owed. On top of that, you have to deal with the IRS, which is punishment enough. That's just for filing late.

Strangely, the penalty for Failure to File is worse than the penalty for Failure to Pay, which is 0.5% per month. If you owe $1,000, but file three months late, you'll have to pay $1,150. But if you file and don't pay, you owe only $1,015 after three months. If you go over 60 days, the minimum you pay is $100 or 100% of the return, whichever is less. (The IRS also charges interest on penalties, naturally.)

There's no statute of limitations on lateness—the IRS will come after what you owe even 80 years later, if you live that long. The lesson here is to file even if you can't pay what you owe.

Let's say it again: it's better to file for an extension. Form 4868 ("Application for Automatic Extension of Time to File U.S. Individual Income Tax Return") is part of your e-filing tax software. An extension also must be filed by April 15, just like a standard tax return. Doing so provides an extra six months to do the federal paperwork, until October 15, 2024. For states, the date varies.

There's one problem. If you owe money, an extension doesn't mean you get to pay later. If you don't file your taxes until October, you may find you already owe six months' worth of penalties. In extreme cases, if you meet a lot of legal requirements, you may apply for an Extension of Time for Payment of Tax due to hardship. We have great advice on how to get help if you owe more money at tax time than you currently have on hand; read What to Do If You Can't Pay Your Income Taxes.

Remember, you have the right to appeal to the IRS before you pay a single dime. It's all part of the Tax Payer Bill of Rights.

Deductions, if Possible

There's a chance you're among the hundreds of thousands of US citizens this year who don't bother itemizing any deductions. That's because the standard deduction for most people was increased so much in 2017 that itemizing deductions doesn't seem worth the hassle. You'll be just as likely, if not more, to get a federal refund without doing the extra work. The standard deduction will be higher for about 90% of people, depending on their filing status.

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A lot of itemizable deductions went away under the so-called Tax Cuts and Jobs Act in 2019. There are no more deductions for personal exemptions, SALT deductions, moving expenses, work expenses (until 2025), or even most tax preparation fees. However an individual can deduct an extra $300 for cash donations to charity.

You may see some benefit with deductions on your state return, though.

If you're still claiming deductions no matter what, here are a few you can sandwich in at the last minute, even if 2023 is long over. Until April 15, 2024, you can contribute to a traditional or Roth IRA and deduct the amount from your income for 2023. Contribute up to $6,500 or $7,500 if you're over 50. That can save you $2,200 in taxes. Those limits go up by $500 each next year.

You can still contribute to a Simplified Employee Pension IRA (SEP-IRA) and/or Health Savings Account (HSA) for the 2023 calendar year. For the SEP-IRA, the limit is $69,000 or 25% of your compensation, whichever comes first. For the HSA, don't go over the maximum contribution of $4,150 for individuals or $8,300 for families. You can add $1,000 if you're over age 55 by the end of the year.

Need to find more deductions? Try these:

• Are you a volunteer? You can't deduct your time or personal expenses (say, lunch while you're helping), but you can claim up to 14 cents per mile driven in a personal vehicle while traveling for voluntary acts for a nonprofit. Parking and tolls, too. (That's right: You can claim mileage for volunteering but not for actual work.)

• If you're in the armed forces and have to relocate due to a change of station (under orders), you can claim 17 cents per mile driven for moving purposes.

• If you paid directly for glasses or contacts, examinations at any doctor, co-pays at the office, teeth cleanings, hospital visits, ambulance bills, and so on in the calendar year 2022—and those medical expenses add up to more than 7.5% of your adjusted gross income (AGI)—you've got a major deduction on your hands. It may take a lot to get to 7.5%, but one year with a serious illness can add up quickly.

• If you did any kind of home improvement for medical reasons—like installing a wheelchair ramp—that's deductible, but again it must fall within that 7.5% above, with all the other medical expenses.

• Medical-based mileage is also worth a deduction of 22 cents per mile.

• Paying some tuition? The American Opportunity Tax Credit is $2,500 per student (give or take). It can cover more than tuition.

Know Your IP PIN

For a select group of citizens—mainly, those with a compromised Social Security number—the IRS assigns a six-digit Identity Protection personal identification number (IP PIN). It's another extra-governmental identifier that might make privacy advocates apoplectic but helps the IRS in its constant battle against fraud.

It provides government accountants extra assurance that you are you. If you ever got one of these numbers, even as part of a pilot program, it's required for all future tax returns. If you can't find your IP PIN (it comes on a CP01A notice; you'll get a new one every year), go to the Get An Identity Protection PIN (IP PIN) page to retrieve it. If you've never received an IP PIN in your life and don't mind the government having another number to ID you, you can opt in.

This system utilizes the same ID.me system that was once going to require facial recognition, but the IRS will not require that. Eventually, the IRS plans to switch over to a Login.gov authentication tool requirement, the same ID system used by the Department of Veterans Affairs and the Social Security Administration. Thus far, use by IRS of Login.gov is limited and under review.

Don't Sweat the Audits

A lot of people get stressed about an audit. That's when the IRS comes in and goes over your records to make sure you're not a big ol' tax liar. Tax prep software like TurboTax will provide a rundown of why it believes you're at risk of an audit (or not). Audits have declined almost every year since 2010; there was a small upturn in 2019 but it's still less than 1% of returns.

That's because of staffing. The IRS lost 21,000+ employees between 2010 and 2019 because its budget was cut by 20.4%. As noted above, there's been a lot of hiring lately, but the IRS is far from back to its highest staff levels.

Filers who make over multi-millions a year are statistically more likely to get inspected, no matter what--AARP says 1.2% of returns for incomes between $1 to $5 million get audited; it goes up to 9.2% if you make over $10 million.

There might be some random audits, but if you've never been audited before, it's unlikely to happen now if you don't throw any red flags in your filing. Don't stand out. The IRS is using algorithms just like everyone else to see who in your income bracket is unique. Unique gets noticed. Noticed gets checked.

Among the red flags you should avoid:

• Unusually large deductions (such as claiming you gave half your income away to charity)

• Claiming a hobby is a business that always loses money

• Having a business that's always reporting losses

• Owning offshore accounts

• Publicly protesting paying taxes (then not paying)

• Making a lot of math errors in your returns

• Amending your taxes a lot

• Filing for a lot less than what was reported on your W-2 (don't use your final paycheck to calculate your income for taxes; that's an automatic audit, people)

Most audits don't require a big meeting with the IRS in dark meeting rooms in dingy offices as if you're in the cast of Everything, Everywhere, All At Once; 77% of audits happen via mail when the IRS requests extra records. The average amount owed on such an audit is around $7,000, according to H&R Block. If auditors do come to your office or home, or you go to the IRS office, the average shoots up to $65,000.

It's worth noting that research shows the IRS audits the poor (those who earn the Anti-Poverty Earned Income Tax Credit) much more than any other tax bracket according to a report from TRAC IRS from Syracuse University.

At least one accountant claims a good way to avoid audits is to always file for an extension and submit tax paperwork in the height of summer, because auditors like to vacation, too. The AI that'll be checking all our returns in the coming years probably won't fall for that, but you can try.