IRS Tax Deadline Survival Guide: 10 Rules for Last-Minute Filers to Get Maximum Refunds

April 14, 2011 -- Worried that the IRS will penalize you for filing taxes late? There's no penalty for waiting until the last minute. This year you still have plenty of time to e file or file by mail, since the Internal Revenue Service has extended its tax filing deadline to April 18. File correctly, and you'll minimize the chances the IRS will find fault with your tax return, thus maximizing your chance of getting a prompt tax refund.

Comforts Philadelphia tax attorney Kelly Phillips Erb, "There's practically no mistake you can make on your taxes that can't be undone." So, relax. Take a deep breath, pour yourself a soothing beverage, and follow these 10 rules:

-Congratulate yourself. By delaying paying taxes, you've done the smart thing. You've earned every cent of interest owed you and enjoyed every financial reward, right up until the minute you must render your money unto Washington. Uncle Sam, after all, provides no incentive for making early payment. The great majority of filers, according to TurboTax, wait to file until March or April. So, you're in good company.

-Use time wisely. If you're staring at a rat's nest of random documents and unorganized receipts, spare yourself having to paw through it. Maybe the materials you need are in your hand already. To find out, consult a checklist, advises Erb. When it comes time to do the math, lay down your #2 pencil, unfurrow your brow, and use the tax calculating tools available online, many for free. For example, there's an IRS calculator for figuring withholding. By using these you'll speed preparation, minimize your mental anguish and protect yourself from error.

-Just in case, identify the location of the nearest post office that stays open until midnight on April 18. If you're not using the Post Office to file but instead are using a private delivery service (e.g., UPS, FedEx), check the IRS list of which ones are approved. Not all are. Retain dated, written proof of mailing.

-E file. Don't have time to file by mail? Then e-file online. If you have the luxury of doing so a day or two in advance of April 18, do it. Reason? Your return will not be considered successfully e filed until you have received electronic confirmation from the IRS that it was received. This can take a day or two.

-Eyeball what the IRS dubs its "Dirty Dozen Tax Scams"—and make sure you're not giving the appearance of perpetrating any. They include the abuse of charitable deductions; exaggerating fuel tax credits; and creating a fake or misleading Form 1099 Original Issue Discount (OID), which is used to report taxable interest income from bonds, notes or other long-term debt instruments.

-No Frivolity. The IRS imposes penalties on filers making what it deems "frivolous arguments"—your asserting, for example, that you don't have to pay any income tax because the government has no Constitutional authority to impose it. Avoid these.

-File Form 4868 for an extension if you need one. The IRS will automatically grant you up to six more months to file. Be advised: What you're getting, here, is an extension of the date to file, not the date to pay. Even with an extension, you must make a payment by or on April 18.

-Pay the full amount. If your taxes are too big for you to pay in full, first double-check your math. Make sure you've claimed every permissible deduction. If you're unsure whether something is deductable, ask the Taxpayer Advocate Service, whose advice is free. They can answer questions on a wide range of topics before you file, and, afterwards, can tell you the status of your tax refund. If you don't have enough cash to pay your taxes, pay by credit card though fees are involved.

-Can't pay it all? Pay some. The IRS looks favorably on filers they believe are making a good faith effort. While you have to make "a payment" to the IRS on or by the April 18, that payment can be as little as $1. Pay that minimum, and you won't have broken any rule--though you will have to pay interest to the IRS on what you owe, plus any penalties. If you owe $25,000 or less (in combined tax, penalties and interest), you can get permission to pay in installments by filing Form 9465 and using the Online Payment Agreement (OPA). Taxpayers with annual incomes of up to $100,000 and tax liabilities up to $50,000 can enter into an agreement with the IRS called an Offer in Compromise, which settles the taxpayer's tax liabilities for less than the full amount owed, subject to IRS approval, which is by no means a given.

Persons unable to pay their taxes because they are suffering or expect to suffer economic hardship can ask the Taxpayer Advocate Service to intervene on their behalf.