Tax Day is Tuesday. Are you ready? Tips for late filers
For many tax filers, state and federal income taxes are due Tuesday.
If you are done working on your 2024 taxes, congratulations.
If you have not, may the last-minute tax filing tips below, from one San Diego finance professional and the Internal Revenue Service, make the coming days a little bit less of a drag.
Insights from a finance pro
Levi Anderson, a financial planning manager with the San Diego office EP Wealth Advisors, a fee-only, fiduciary firm, shared some insights and reminders for anyone still working on their taxes, whether alone or with a tax professional.
- If you’re filing an extension, you still have to pay your tax balance by Tuesday’s tax deadline, Anderson said. “If you are filing an extension, be aware that taxes are due on the original tax deadline although you are filing an extension,” he said. “Although the penalty for ‘Failure-to-Pay’ is less than the ‘Failure-to-File’ penalty, the penalty and interest can add up if you wait until later to pay your taxes you owe.”
- It’s not too late to contribute to your 2024 retirement accounts — even though we are four months into 2025. Those contributions could reduce your taxable income. “Making a last-minute contribution to these accounts still can count for the 2024 tax year until April 15th. Just be sure you note it as a 2024 contribution when you make it,” Anderson said.
IRS resources for last-minute filers
For last-minute filers looking for free filing resources, qualified taxpayers can still use IRS Direct File and IRS Free File. “Additionally, anyone can use IRS Free File to submit an extension of time to file regardless of their income,” the agency says on its website. Link: irs.gov/filing/file-an-extension-through-irs-free-file
The IRS has a searchable FAQ page with links to almost 60 questions and answers, including “Should I file an amended return?” and “How do I correct an excess salary deferral to my 401(k)?” and a series of questions about payments and distributions dubbed “Is it taxable?” Link: irs.gov/help/ita
The IRS’s last-minute tips page also has information for people who are eligible for automatic extensions and who have trouble paying their tax bills. Link: irs.gov/newsroom/last-minute-filing-tips-resources-available-to-help-taxpayers-who-still-need-to-file
Avoiding errors
The IRS also shared pointers to minimize the chance that your return will have an error.
- Triple check that your filing status, names, Social Security numbers and birthdates are correct. Same goes for bank account and routing numbers, for a refund via direct deposit.
- Answer the digital asset question on Form 1040 and several other forms: “At any time during the tax year, did you: (a) receive (as a reward, award or payment for property or services); or (b) sell, exchange, or otherwise dispose of a digital asset (or a financial interest in a digital asset)?” Examples of digital assets include convertible virtual currencies and cryptocurrencies, such as Bitcoin, and non-fungible tokens (NFTs). Income from these assets is taxable.
- The agency also recommends using electronic filing over paper filing, as a tool to boost accuracy. “Electronic filing decreases mathematical errors … and prompts taxpayers for missing information. Opting for electronic filing and selecting direct deposit is the fastest and safest way to receive a refund,” the agency says.
Planning ahead
Anderson, the San Diego finance professional, said now is a great time to start getting in shape for next year’s filing season.
“While reviewing your tax return, ask your preparer if they would recommend you consider doing something different in order to be in a better tax position next year,” he said. “While you may not be able to have a lengthy strategy session on the spot, your tax situation will be fresh in your preparer’s mind, and they may have very helpful pointers for you to consider between now and the end of the year.”
Don’t just put your tax return in a drawer, Anderson added. “The biggest issue we see is that people don’t think about taxes until this time next year. Most of the tax-savvy moves need to be done by Dec. 31.”