News From Terre Haute, Indiana

Local & Bistate

April 14, 2014

Mailbox by midnight?

TERRE HAUTE — Forget going to a mailbox before midnight. A record number of U.S. residents are expected to file tax returns electronically to meet today’s tax deadline.

Mary Dando, spokeswoman for the U.S. Postal Service, said the last mail collection today in Vigo County will be at 7 p.m. at the mailing facility at 150 W. Margaret Ave. The postal service no longer has extended hours or even special colored mailboxes for tax returns.

“We’re just not seeing the volume like we have seen before, with going to midnight (on extended hours) and things like that,” Dando said.

The IRS, through April 4, had received 99.85 million tax returns and expects to receive 35 million additional tax returns by today’s tax deadline, said IRS spokesman Luis D. Garcia.

The IRS expects about 91 percent to be filed electronically this year. Last year, 103,193 tax returns in Indiana were filed through the IRS’s free tax file at www.irs.gov.

The average refund nationally in 2014 is $2,792. And in Indiana, “82 percent of people who file a federal tax return are getting a refund,” Garcia said. Nationwide, the federal government will refund more than $219 billion, a 2.5 percent increase from last year.

The IRS had more than 90.3 million tax returns filed electronically as of April 4, which marked a 1.9 percent increase from last year, Garcia said.

“But what is interesting in the e-filing, the percentage of people who are paying a professional to prepare their taxes has declined seven-tenths of a percent and those who are filing electronically and preparing tax forms themselves, has increased by 6 percent,” Garcia said.

“During the last week, we do get a large chunk of people [who file tax returns; unfortunately, the vast majority of them are getting a refund, so they have waited months just to get their own money. Also, some people wait because they owe, which makes sense if you want to make that payment at the last minute. But we always encourage people to file early, whether they owe or not, and send in payment to hit on April 15,” Garcia said.

Still, about 12 million taxpayers have requested extensions, the IRS reports, giving them an extra six months to file.

Yet, that extension only applies to the tax form, not to any taxes owed, said Andy Stadler, owner of Stadler & Company, a bookkeeping and tax service company.

“A lot of people have a misconception that an extension gives an additional time to pay taxes they owe. Extensions don’t work like that. It gives more time to file the tax return, but it does not give more time to pay the taxes. They are due by midnight,” he said. “If not paid on time, [the taxpayer] will get a penalty.”

The extension does remove a penalty for not filing a tax return on time, Stadler said. Federal penalties and interest combined for not filing and not paying on time can be nearly 25 percent, Stadler said.

“We will file a lot of extensions for folks because, for whatever reasons, they can’t get their tax returns done. It has to be done by midnight, so we’ll be staying late in the office,” Stadler said.

John Vaughn, accountant for Kemper CPA Group, said some tax delays have been caused from forms received from brokers. To meet IRS rules, the brokerage accounts mail out tax information on gains and losses, but then have to file amended forms. “That seems to be pushing people late, which is mostly waiting on information from investments,” he said.

“We also have more people getting involved in publicly traded partnerships, which issue K-1 forms, which come out late March or early April,” which report each shareholder’s income, losses, deductions and credits, Vaughn said.

Stadler said he sees three reasons this year why people may be filing taxes closer to today’s tax deadline. “First, there was a later start to the Internal Revenue Service this year because of the federal government shutdown. They didn’t get their computers programmed in time, so that pushed them to start taxes later than normal,” Stadler said.

Secondly, in Vigo County, the schools had a spring break that was closer to the tax deadline, and people waited to complete their tax returns until after the break, Stadler said.

“The third reason is the economy has been better for a lot of folks. Although it is not great, it is a little better and people are just flat out waiting because they are busy working, they are employed, which is a good thing,” he said.

Garcia said today also marks the last day to file for almost $760 million in refunds, as an estimated 918,600 taxpayers nationwide did not file a federal income tax return for 2010. In Indiana, there is about $15.47 million in unclaimed federal refunds. The median potential refund is $570 in Indiana, Garcia said.

“Many of these people did not have a requirement to file,” Garcia said. “Some people think, ‘well, it is a wash,’ or they are below the requirements and think it is more trouble than it is worth to file. But there is a lot of online free software” to file a tax return, he said.

Single people under age 65 do not have to file a tax return for 2013 taxes (paid in 2014) if they make less than $10,000 gross annually and married couples, under 65, if they gross under $20,000 annually. People who earn less than $58,000 annually are eligible to file free federal tax returns through the IRS, Garcia said.

Reporter Howard Greninger can be reached at 812-231-4204 or howard.greninger@tribstar.com.

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