I know how stressful tax time can be, and I know there are quite a few families out there who believe they’ll never get it filed on time. Here are some suggestions to consider to help you become more prepared for next year.
What if you owe?
If you owe, work with your tax professional (if possible)
- Be as accurate as you can when calculating your tax liability.
- Pay your tax on or before April 15.
- If your tax return is not complete, submit an extension to file, IRS Form 4868.
- The extension to file is not an extension of payment, so pay on time!
What if you can’t pay the total tax due?
Contact the IRS immediately at 800-829-1040 to discuss options
- Ask about the “Fresh Start Initative”.
- The initative may be an installment payment agreement or an offer in compromise.
- Do not wait! Please do something on or before April 15.
What you need to do after April 15 as a special needs family
Special needs families do not have the luxury of preparing for taxes from January 1 through April 15; tax season is all year. You need to know if any current and future expenses are possible income tax deductions. Organization of your receipts and statements are key.
You may discover that your income tax threshold is not enough to obtain a tax deduction. Look into other ways to recoup your expenses, such as Health Savings Accounts, Flexible Spending Accounts, a health insurance reimbursement, or some other arrangement.
Don’t know if a medical expense is a legitimate tax deduction? You can find that out by visiting irs.gov and searching for Publication 502, Medical and Dental Expenses. My book and free webinars also discuss what is and is not a medical expense tax deduction.
Find an organizational method that suits your personality. If you file your documents in a cabinet or use apps, do whatever is most comfortable.
The best way to get through tax season is to prepare year round. Learn from your mistakes this year and resolve to become a prepared, organized, and empowered special needs family.
Yolanda Baker is an Austin-based accountant and the author of BITE Your Bills: Cutting Medical Expenses for the Disabled. She provides webinars and assistance with health insurance issues, medical expense tax deductions and assisting those with high health care costs.
Please note that the information Ms. Baker provides is for informational and entertainment purposes only. It is not to be considered financial or medical advice. Please consult with a financial or medical professional for clarification.