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If you miss this week’s tax filing deadline, you might be feeling anxious about getting hit with late-filing penalties by the IRS. However, if you don’t have a recent history of filing your taxes late, it’s possible to apply for something called a first-time penalty abatement, which will waive some of your penalties. Here’s a look at how you can apply……Story continues….
By: Lifehacker Staff
Source: Lifehacker
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What is the last day to file taxes? The last day to file taxes for individual federal income tax returns is usually April 15 unless this falls on a Saturday, Sunday or official holiday. Some state-level holidays can extend the tax deadline by another day. Tax cuts are changes to the tax code that reduce the amount of tax you have to pay. A common way of cutting taxes is to reduce the income tax rate—the percentage of taxable income that an individual or business pays in taxes.
So as long as you earned income, there is no minimum to file taxes in California. It is a good idea to talk with a tax professional to determine your filing status and whether you are required to file or could benefit from doing so anyway. You will have 90 days to file your past due tax return or file a petition in Tax Court. If you do neither, we will proceed with our proposed assessment.
Lower individual tax rates have increased disposable income throughout the economy, increasing consumer spending on goods and services, including retail purchases. Increased consumer spending has driven demand, leading to higher sales for retailers across the country. California’s tax system is relatively flat overall, whereas most states have highly regressive taxes that ask less of the rich than of anyone else.
California’s choice to have a less regressive system largely explains why California collects more tax revenue per capita than other states without especially high tax . Your dependents, retirement savings, health care savings, education expenses, and home improvements can all play a part in lowering your tax bill. Charitable donations, medical expenses, mortgage interest, and local taxes can be tax-deductible only if you itemize on the Form 1040 Schedule A.
If you earn less than the Standard Deduction for your filing status, you likely don’t need to file a tax return. Even if you don’t meet the filing threshold, you may still have to file taxes if you have other types of income. The IRS may also impose a wide range of civil and criminal sanctions on persons who fail to file returns. If you owe tax and your return was not filed by the due date, including extensions, you may be subject to the failure to file penalty, unless you have reasonable cause for not filing.
How Long Can You Go Without Filing Taxes? There is no statute of limitations on unfiled tax returns, but you’ll want to file as soon as you can to minimize any penalties. If you’re not sure if you’re required to file for a particular tax year, you’ll need to find out the filing income requirement for that year.How long can the IRS collect back taxes? In general, the Internal Revenue Service (IRS) has 10 years to collect unpaid tax debt.
After that, the debt is wiped clean from its books and the IRS writes it off. This is called the 10 Year Statute of Limitations. Is getting a big tax refund a good thing? No, some financial experts and taxpayers say, because it means you’re giving up too much of your paycheck to taxes during the year. If less is taken out for taxes, you’ll get a smaller refund but more money in each paycheck for expenses or saving and investing, they argue.
There are a lot of variables that affect your refund or tax due including how much you earned, how much tax you had withheld, your filing status, the number of dependents you claim, your deductions and credits, etc. You may have lost Earned Income Credit or the Child Tax Credit— did a child turn 17?High-Income Taxpayers Paid the Highest Average Income Tax Rates. In 2021, taxpayers with higher incomes paid much higher average income tax rates than taxpayers with lower incomes.
white Americans are 83 percent of total taxpayers, and the percentage of zero-tax filers who are white is 79 percent. African Americans are roughly 13 percent of total taxpayers and 17 percent of zero-tax filers. Asian Americans comprise 3.6 percent of total taxpayers and 3.4 percent of zero-tax filers.
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