3 Last Minute Tax Tips for Procrastinators

Time is running out to file your 2017 tax returns. With the April 17th deadline quickly approaching, procrastinators everywhere are scrambling to submit their paperwork on time.

Does this sound like you? Don’t panic. Take a deep breath and follow these three last-minute tax tips from the professionals at American Investment Planners, LLC…

Take your time.

Better safe than sorry. The old adage holds true when submitting your tax return. Even if you are filing last-minute, it’s important to take your time when preparing your paperwork. Rushing through increases your chance of making a mistake, which increases your chance of an audit. Some of the most common last-minute errors include:

• Mathematical mistakes
• Misspelling names
• Entering the wrong social security number(s)
• Failure to sign or date your return

File faster online.

Submitting your taxes online offers tons of benefits. It’s quick, easy, allows for faster refunds, and can even help minimize mistakes and maximize deductions. Last-minute filers will love the ability to submit their returns during the waning hours of Tax Day, after post offices have closed. Not to mention, it’s nearly impossible to schedule a meeting with a professional tax preparer this late in the season.

Consider filing for an extension.

If you feel that there is no way you can get your taxes submitted by the April 17th deadline, you can always apply for an extension, pushing the due date back to October 16th. Beware, if you owe money to the IRS, you will still need to pay your debt before April 18th. An extension on your paperwork is not an extension on your bill. You can learn more about the advantages and disadvantages of applying for a tax extension by clicking here.

American Investment Planners, LLC proudly employs a team of professional tax planners and advisors to help with all of your financial needs. To schedule an appointment with one of our consultants, please call (516) 932-5130 or email info@americaninvestmentplanners.com.

What To Do if You Get Audited by the IRS

If there’s one thing American taxpayers hate more than paying taxes, it’s being audited by the IRS. While your chances of an audit are slim (about 1% if you make less than $200,000), they do happen, so it’s best to be prepared just in case.

The tax professionals at American Investment Planners, LLC have decades of experience dealing with the IRS. Here’s what they say you should do in the event of an audit:

• Take a deep breath. Audits can be intimidating, but most of them are no big deal. Usually, an audit involves answering a few additional questions via mail; it’s rare to meet with an auditor in person.

• Figure out why you are being audited. Often, the IRS will only need additional information about one portion of your tax return, not the entire thing. Once you know why you are being audited, only provide the information the IRS specifically asks for. Supplying anything more risks the chance of broadening the audit scope.

• Gather your documents. Your audit letter should include a list of the documents you need. These may include:
• W-2s
• 1099s
• Bank statements
• Proof of income
• Investment statements
• Receipts and other proof of expenses

• Be polite and responsive. Like dealing with the police, much of the process is at the discretion of the auditor. If you are kind, polite, and accommodating, you will have a more pleasant experience than if you act like a jerk.

• Consider hiring a professional. You don’t have to show up to your audit alone. In fact, you may not have to show up at all. It’s recommended to bring a tax professional with you, or have one go in your place. If you choose the latter, you will need to submit IRS Form 2848.

American Investment Planners, LLC has been helping Americans file their tax returns for decades. To schedule an appointment with one of our tax professionals, please call (516) 932-5130 or email info@americaninvestmentplanners.com.

American Investment Planners does not provide tax or legal advice. Consult with a qualified legal or tax professional regarding your particular situation.

Advantages and Disadvantages of Applying for a Tax Extension

Important reminder: Tax Day 2017 is Tuesday, April 18th. This is the last day individuals can submit their tax returns to the IRS, unless you file for an extension.

Tax extensions extend this deadline to October 16th, giving individuals an extra six months to prepare and submit their paperwork. While this sounds like a dream come true for busy families and procrastinators, it does have its drawbacks.

Let’s take a look at some of the pros and cons of filing for a tax extension:

Advantages of filing for a tax extension:

• It’s easy. Few things are easy when it comes to the IRS, but filing an extension is one of them. Just file before the deadline and fill out the form correctly, and they will be happy to grant you an extension – no questions asked.

• Avoid late fees. Submitting your taxes past the deadline (without filing for an extension) is a fineable offense, and could cost you 5% of your refund check each month you are late, with a cap of 25%. You worked hard for your money, don’t lose it because you didn’t file on time!

• Potentially save yourself an audit. If you rush to submit your taxes before the deadline, chances are greater you will make a mistake, resulting in a dreaded audit. Giving yourself more time to submit your taxes reduces your chances of a critical mistake, and thus reduces your chance of an audit.

• Cheaper preparation. Professional tax preparation services are at their busiest during March and April, and often charge a premium during these months. Not only will appointments be easier to make after the deadline, they might even be cheaper.

Disadvantages of filing for a tax extension:

• You don’t get an extension on taxes owed. Unfortunately, an extension on your paperwork is not an extension on your bill. If you owe money to the government, you must still pay it before the April 18th deadline.

• You delay your refund check. The longer you wait to file your return, the longer you wait for your refund check – it’s as simple as that.

• You are only prolonging the inevitable. Your taxes won’t be any easier six months from now. If you procrastinated this time around, chances are good the same will happen in October, only without the option of an extension to save you.

After weighing out the pros and cons, it makes sense for most people to file their taxes before the deadline, barring any extenuating circumstances. If you are stressing out about getting yours done on time, contact the tax professionals at American Investment Planners, LLC. We will have your return submitted before the deadline, and guarantee to get you the biggest refund possible.

To schedule an appointment with one of our professionals, please call (516) 932-5130 or email info@americaninvestmentplanners.com.

What to Bring to Your Tax Appointment

If you are having your taxes prepared by a professional this season, it is up to you to provide them with proper documentation. Insufficient or missing paperwork can result in a lower tax return, or even an audit.

While every taxpayer’s situation is different, this is a good general list of items you should bring with you to your tax appointment:

Personal Information

• Your social security or tax ID number
• Your spouse’s full name and social security or tax ID number
• Your dependent’s full name, birthday, and social security or tax ID number
• Three years’ worth of previous tax returns

Income Statements

• W-2 Forms
• Unemployment forms
• Jury duty records
• Rental income
• Hobby income and expenses
• Gambling income
• Prizes and awards
• Trusts

Itemized Deductions

• Mortgage statements
• Healthcare expenses
• Employment-related expenses
• Records of charitable donations
• Job search expenses
• Moving expenses
• Theft losses
• Childcare expenses

Savings & Investments

• Interest and dividend income
• Income from sales of stocks
• Dates of stock acquisition, and the price you paid for them
• Other expenses related to your investments

Retirement Funds

• IRA contributions and total value
• Income from pensions
• Social security income

Vehicle Information

• Total miles driven
• Total business miles driven
• Amount of parking and tolls paid

If You Are Self-Employed…

• 1099-MISC
• 1040ES
• Income and expense statements

If you received any other tax documents which weren’t listed above, you should also bring those. When in doubt, it’s always better to bring something!

American Investment Planners, LLC offers professional tax preparation services to individuals and businesses across the country. Let us make your tax season less taxing. To schedule an appointment with one of our tax professionals, please call (516) 932-5130, or email info@americaninvestmentplanners.com.

5 Critical Mistakes to Avoid on Your Tax Return

Got your mind on your money, and your money on your mind? If you want to get the most out of your tax return this year (and avoid the dreaded IRS audit), avoid making these critical mistakes:

Missing the deadline.

First things first: know your deadline! The IRS will begin accepting tax returns on Monday, January 23rd, 2017. The deadline (also known as National Tax Day) is Tuesday, April 18th. If you wish to apply for a six-month extension, you must do so by this day. However, any taxes you owe are still due on April 18th.

Math miscalculations.

This is the single most common mistake on tax returns each year. Whether you made an error in your calculations or while transferring your numbers, you can bet the IRS will quickly detect your mistake. Having your taxes prepared by a professional can help minimize this risk.

Misspelled names.

The IRS cares about numbers, but names are important too. If the name of the taxpayer, spouse, or dependents doesn’t match what the IRS has on file, your return could be significantly delayed.

Forgetting additional income.

You’ve included your wages from your full-time job, but you could be forgetting about these common sources of additional income:

• Part-time or side jobs
• Job that you only worked at the start of the year (if you worked just one day in 2016, it counts!)
• Savings and investment accounts
• Unemployment benefits
• Jury duty pay

Wrong bank account numbers.

Imagine this: you’ve double checked your numbers. Triple checked, even. Everything is right and you are ready to submit your form to the IRS. You opt for the direct deposit, and enter the wrong routing or bank account number. Don’t let this happen to you – make sure your return is going to the right place!

Having an experienced tax professional by your side will not only ease your stress and help you avoid making mistakes, they can find additional deductions and credits that you may not be aware of. Trust American Investment Planners, LLC to help you file your tax return this season.

To schedule an appointment with one of our tax professionals, please call (516) 932-5130 or email info@americaninvestmentplanners.com.

What To Do When You Miss The Tax Deadline

American Investment Planners LLC

500 North Broadway, Suite 260, Jericho, NY 11753

(516) 932-5130 / (866) 932-5130

Although you might feel that with all of the reminders it would be difficult for anyone to miss the tax deadline, the truth is that many people do miss it each and every year. And yes, although filing late can result in some penalties, we're here to calm some of the stress you may be feeling to let you know that you still have options if the deadline has been missed:

1. File ASAP: The sooner you can file your tax return and pay (if you owe), the better. If you do wind up having taxes to pay, the less you delay, the less you may be charged in interest and in penalties.
2. Apply for an extension: If you require more time to prepare your tax return, consider applying for a tax extension. Although doing so will not give you any longer to pay what you owe, it may give you piece of mind knowing that you have some extra time to get your tax return ready.
3. Pay what you can: A common reason people struggle with the tax deadline is that they owe taxes, but can't afford to pay them all at once. When this is the case, make it a priority to pay as much as you can, as soon as you can. While you will likely still be responsible for penalty and interest charges, if you pay as much as you are comfortable paying right off the bat, it may make those penalty and interest charges not as high.
4. Ask for an installment agreement: The IRS offers something called an installment agreement for qualifying individuals who require more time to pay their taxes. To apply, start by checking out the IRS Online Payment Agreement Tool - you'll need your name, an email address, physical address, date of birth, filing status and your social security number.

Should you be owed a refund from the IRS, your best bet is to follow tip number one and file as soon as possible so that you get your refund without too much of a delay. Remember, if you do not file within three years, the refund you are entitled to may no longer be up for grabs.

At American Investment Planners LLC, we have a strong team of financial planners with experience in taxes and tax planning that are ready to help you if you have a concern about missing the tax deadline. To speak with one of our financial advisors, please give us a call at (516) 932-5130 or email info@americaninvestmentplanners.com today.

Reminder! Tax Scams You Need To Be Aware Of

American Investment Planners LLC

500 North Broadway, Suite 260, Jericho, NY 11753

(516) 932-5130 / (866) 932-5130

Although the tax deadline is only a few weeks away, there is still plenty of time to be targeted by scammers who are looking to get a little extra out of you during this tax season. Earlier this month, we warned our readers about three of the most common tax scams that we often hear about, and today, we're here to remind you about them and share our recommendation for what you should do if you think a scammer is coming after you; read more below.

Common Tax Scams

While some tax scammers may use an original approach, three of the most common that people experience are: 

1. Phony phone calls
2. False links in emails
3. Frivolous arguments

One of the most important things to remember is that the IRS' preferred form of communication is U.S Mail, so if you ever get a phone call or an email from someone who claims to be a representative, approach it with much caution. And remember, the IRS will never ask you for your financial information over the phone, require you to pay without actually sending you a bill, demand payment without giving you the opportunity to ask questions or insist that you use a certain method to pay your taxes - if either of these situations present themselves to you, hang up and/or ignore the email.

Another important thing to remember is that the IRS will never threaten you with arrest. Scammers will often make you think that legal action will be taken against you if you do not comply with their request, but that is an immediate sign that you are dealing with someone who is falsely representing themselves.

Where frivolous arguments are concerned, we'd all love to be told that we are exempt from filing taxes, but the truth is that we are all required to file no matter what, so if someone positions you as the "lucky one" this year, don't fall for it!

Actions To Be Taken

If you suspect that you're being targeted by a scammer this tax season, the best thing to do is to contact your financial planner so that they can confirm if what you're being told is true or false. Then, let the IRS know about it - here is a list of things you should do if you receive IRS-related communication that seems rather suspicious.

Whether you actually experience a tax scam or not, know that we at American Investment Planners LLC want to see you and your information protected at all times, and we can help! To learn more about our financial planning services, please visit our website or give us a call at (516) 932-5130 today.

Smart Uses For Your Tax Refund

American Investment Planners LLC

500 North Broadway, Suite 260, Jericho, NY 11753

(516) 932-5130 / (866) 932-5130

We all walk into our tax appointments with a glimmer of hope that the outcome will be receiving a nice refund from Uncle Sam, and when that's the case, it feels like we're on cloud 9. But let's not get too ahead of ourselves - we're sure that just like us, you have some ideas for what you'd do with your tax check, but you shouldn't just go out and spend it without thinking.

If you want to get the most benefit out of your tax refund this year, here are a few things we suggest doing with it:

Add it to your retirement fund: Even if you contribute to your employer's 401(k), you may not be saving as much as you need to for retirement. So, take this extra bit of cash and stash it away in a savings account that you have dedicated to this point of your life. 

Save for college: Have a child at home that you'll be sending off to college soon? If you plan to help cover the cost of tuition, put all or some of your tax refund aside so that you have it ready when the time comes.

Invest: If you've always thought about investing but weren't financially able to before, use your tax refund to get started. But before you do, keep in mind that finding the right investments can be tricky, so you should meet with a financial planner like ourselves to determine a strategy that's right for you!

Pay off debt: Did you make a large purchase recently that's been taking some time to pay off? If so, use your tax refund to reduce how much you still owe! For those of you with expenses that have a high interest rate, consider putting your refund towards those payments so that you can help knock down how much interest you accrue moving forward.

Looking for more ideas on what to do with your tax refund this year? This article from Kiplinger has some answers!

At American Investment Planners LLC, our goal is to help our clients achieve financial security and build a legacy that they can pass on. If you have yet to work with a financial planner, please give us a call at (516) 932-5130 to learn how our products and services can be of help to you.