The April tax-filing deadline is almost here, and many taxpayers who’ve put off that annual task are finishing their 1040s.
Timeliness is important: If you file your return late, the IRS can assess a failure-to-pay penalty worth up to 25% of your unpaid tax. And if your return is more than 60 days late, the IRS assesses a minimum tax penalty of $205 or 100% of the tax you owe, whichever amount is less.
But there are six more tax moves you must — or should — make by April 18.
1. Make your first estimated tax payment for 2017
The IRS requires quarterly estimated tax payments from many people whose income isn’t subject to payroll withholding taxes, often independent contractors or those with investment earnings. You’ll need to figure your adjusted gross income, deductions and credits for the year, then divide the amount due by four. Form 1040-ES can help.
The April 18 annual filing deadline is the first estimated tax due date for affected 2017 earnings. The others are June 15, Sept. 15 and Jan. 15, 2018. (When the 15th falls on a weekend or a legal holiday, you have through the next business day to file. Both of these conditions affect this year’s tax deadline.)
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2. File your 2013 tax return (yes, 2013)
If you were due a refund in 2013 but didn’t file a return, you have until April 18 to submit that old Form 1040 and claim your money. In March, the IRS announced it had more than $1 billion in unclaimed refunds waiting for an estimated 1 million taxpayers who haven’t filed their 2013 federal returns. If you’re one of them, get to work! Miss this year’s deadline, and the U.S. Treasury gets to keep your money.
3. Contribute to or open an IRA
You have until the April filing deadline to contribute to an IRA, either Roth or traditional, for the prior tax year. The 2016 maximum contribution amount for either type of IRA is $5,500 — or $6,500 if you’re age 50 or older. If your traditional IRA contribution is deductible, earmarking it for 2016 could reduce your tax bill. Even if you can’t deduct your contribution, designating it for the previous tax year can help you maximize your retirement account’s growth.
4. Contribute to your Health Savings Account
April 18 is the deadline to put money into an HSA for the 2016 tax year. This medical account, available to individuals who have a high deductible health plan, provides a tax-saving way to pay for medical insurance’s larger out-of-pocket costs. The 2016 limits are $3,350 for an individual HSA owner and $6,750 for a family.
5. File for an extension (but still pay)
You’ve realized you simply can’t finish your 2016 taxes by the filing deadline. Don’t panic. Instead, file Form 4868. This will buy you six more months — until Oct. 16 this year, because the usual 15th falls on a Sunday. Remember that an extension only gets you extra time to file your return. You still must pay any tax you owe, or a good estimate of that amount, by April 18. Include that payment with your extension request or you’ll face a late-payment penalty on the taxes due.
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6. File your state tax return
Most taxpayers also face state income taxes, and most of the states that have an income tax follow the federal filing calendar. Ask your state’s tax department for its due dates and how to get an extension, if necessary. And if you live in Alaska, Florida, Nevada, South Dakota, Texas, Washington or Wyoming, enjoy your totally state-income-tax-free status and focus on your federal filing. The same goes for some residents of New Hampshire and Tennessee, whose state governments collect taxes only on interest and dividend earnings.
Kay Bell is a contributing writer at NerdWallet, a personal finance website.