By Jason Bramwell
Despite the federal government shutdown that went into effect at midnight Eastern time October 1, the deadline for many of the more than twelve million taxpayers who requested an automatic six-month extension from the IRS to file their 2012 tax returns and make payments will remain October 15.
Though October 15 is the last day for most people, some taxpayers still have more time to file and make payments, including members of the military and others serving in Afghanistan or other combat zones who typically have at least 180 days after they leave a combat zone to file returns or pay any taxes due. Also, people in parts of Colorado who were affected by the severe storms and flooding in that state last month have until December 2 to file and pay.
After Congress failed to reach a compromise on how to fund the government in the new fiscal year, which began October 1, the federal government shut down for the first time in nearly eighteen years.
In preparation for a possible shutdown, the IRS on September 26 released a shutdown contingency plan that describes agency actions and activities for up to five business days during the shutdown. If the shutdown lasts longer than five business days, the deputy commissioner for operations support will reassess IRS activities and make any needed adjustments to personnel. As a result, the IRS has suspended all audit activities until the shutdown ends; however, the agency will continue to process tax returns and payments.
Before filing, the IRS is encouraging taxpayers to see if they qualify for the following often-overlooked credits and deductions:
- Benefits for low- and moderate-income workers and families, especially the Earned Income Tax Credit (EITC). (The EITC Assistant can help taxpayers see if they're eligible.)
- Savers credit, claimed on Form 8880, for low- and moderate-income workers who contributed to a retirement plan, such as an IRA or 401(k).
- American Opportunity Tax Credit, claimed on Form 8863, and other education tax benefits for parents and college students.
Also, same-sex couples, legally married in jurisdictions that recognize their marriages, are now treated as married. This applies to any return, including 2012 returns, filed on or after September 16, 2013. Couples must file their returns using either the married filing jointly or married filing separately filing status.
Taxpayers are urged by the IRS to use the IRS e-file to submit their individual tax returns before the October 15 deadline. The agency verifies receipt of an e-filed return. Those needing to make payments can do so online or by phone by using the Electronic Federal Tax Payment System (EFTPS). Those who choose to pay by check or money order should make the payment out to the "United States Treasury."
The IRS recommends that taxpayers file their returns by October 15 even if they can't pay the full amount due. Doing so will avoid the late-filing penalty – normally 5 percent per month – that would otherwise apply to any unpaid balance after October 15. Interest, which is currently at the rate of 3 percent per year compounded daily, and late-payment penalties, normally 0.5 percent per month, will continue to accrue.