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When the last pine needles of Christmas have been vacuumed up and we’ve thrown in the towel a week into our New Year’s resolutions, many of us reach a horrifying realization: Tax Day is approaching.
Another scary thought, what if you owe money and don’t have the funds to pay?
After two years of extended filing deadlines because of the global pandemic, we are back to our more traditional April date. This year, Tax Day is April 18. Traditionally, Tax Day is April 15, but due to Emancipation Day in Washington, DC, the deadline has been moved forward.
Who Owes and Who Gets a Refund?
Last year, 61% of American households wound up owing the federal government nothing when filing their tax returns. That means they either 100% correctly predicted what they’d owe the government and paid it correctly over the course of the previous year or walked away with a nice refund check.
The other 39%? They owed Uncle Sam some money. And experts believe that that number will grow as we move away from some of the relief programs implemented for the pandemic.
But what if you can’t pay your taxes? Are there options for families who don’t have the money when it’s time to file? Below, we’ll explore why families still owe money on taxes even if their employer is taking money out of their paycheck — and how you should proceed if your tax debt is more than you can afford.
8 Tips for Paying a High Tax Bill
You will want to do everything in your power to pay your taxes. The ramifications of tax evasion are extreme and can ruin your life.
So what do you do if you can’t afford your taxes but want to avoid the penalties, asset seizure and potential jail time? We have a few suggestions:
1. Dip Into Your Emergency Savings
While most people struggling to pay their taxes likely don’t have an emergency fund available, it’s worth saying: This is a true financial emergency. If you have an emergency savings accountutilize whatever funds are available to…
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