IRS offers breaks to struggling taxpayers
Felipe Castro holds a sign advertising a tax preparation office for people that still need help completing their taxes before the Internal Revenue Service deadline in Miami, Florida. The IRS is offering breaks to taxpayers struggling to file due to unemployment or reduced income.
The IRS will give certain taxpayers a six-month grace period to file their taxes this year, CNN Money reported.
US taxpayers who are struggling because of unemployment or a significant loss of income will be able to take more time with their filing and avoid the failure-to-pay penalty, but will still owe interest on back taxes, the IRS announced Wednesday.
The relief measures give the grace period to anyone who has been unemployed for at least 30 consecutive days during 2011 or in 2012 up to this year’s April 17 filing deadline, and to self-employed workers whose business income fell 25 percent or more in 2011, the Wall Street Journal reported.
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Taxpayers who qualify for this break do not have to pay tax owed for 2011 until October 15, 2012, instead of the usual April 17 deadline.
“This new approach makes sense for taxpayers and for the nation’s tax system, and it’s part of a wider effort we have under way to help struggling taxpayers,” IRS Commissioner Douglas Shulman said in a statement, Bloomberg Businessweek reported.
Additionally, taxpayers who owe $50,000 in back taxes can enter into a streamlined agreement with the IRS to pay the balance over time, which has been extended to 72 months from 60 months, Forbes reported.
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