Best Solutions For An Unexpected Tax Bill
if you discover you owe taxes and don't have the money to pay the bill, what do you do? first, go ahead and file your return, even if you can't pay in full. a delay in filing may result in penalty and interest charges that could increase your tax bill by 25% or more. include with your return any payment you can afford to make now. to get the money to pay your bill, here are a few options. first, don't be shy about using your emergency fund to pay off the expense. it may be your least expensive option. also, if you have the money to pay your bill, but you don't fork it over, the irs might see this as intentional nonpayment of taxes which can get you in the serious trouble. or, you may be better off financially by putting the bill on your credit card. if irs interest in penalties will be higher than your credit card's finance charges, paying by credit card ? be the best option however given how high credit card interest rate can be. paying your taxes with your credit card may also involve a convenience fee of about two to four percent of the amount you owe. if you decide to go this root, choose the credit card with the lowest apr. consider switching to a new card with a lower apr. then pay off your balance as quickly as possible to minimize your finance charges. if you have investments, now may be the time to sell. ? selling investments in emergency situation ? you may have to take a loss. however, you can use losses to offset gains from selling appreciated investments and this can lower your tax bill in future years. if you know you won't be able to pay in full, call the irs and ask about setting up an installment agreement using irs form 9465. there is a fee to set up the agreement and you'll still face interest and penalties while you're paying off your debt. also, you must make your payments in full and on time every month. one drawback is that the government can still file a notice of federal tax lien on your property until your debt is paid off, which can make moving or using your home ? near ?. however, the government cannot take collection action against you while your agreement is in place. if you are facing undue hardship, form 1127 will allow you to request a six month payment extension, but you'll have to prove your poverty. the irs reserves payment extensions for extremely trying circumstances. remember. never ignore a debt to the irs. they can charge you interest and penalties and even seize your assets and garnish your wages if you don't pay.
- pay a bill・・・支払いをする
- pay off・・・～を完済する
- fork over・・・～を支払う
- installment agreement・・・？→https://en.wikipedia.org/wiki/Installment_Agreement
- tax lien・・・租税先取特権