Business & Tech

So You Still Haven't Filed Your Tax Return?

It's been a challenging tax season between nationwide insurance changes to come and sequester now, says H&R Block tax specialist Karen Kee, offering info for last-minute filers.

“An extension is an extension to file not to pay,” Karen Kee emphatically rattled off when I asked her for last minute tax tips for Patch readers.

Chances are if you haven’t filed yet, it's because you expect to owe the IRS, said Kee, the tax specialist/office manager for both Ossining and Tarrytown H&R Block branches. Those who expect a refund are among the first in line, she said.

However, Kee wanted to make it clear: “People often think they don’t have to pay when they file an extension, but you have to pay 90 percent of what you owe."

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With an extension you can file up to six months later, giving these folks a final deadline of Oct. 15. For those operating by the usual deadline, that’s April 15.

Tax offices such as H&R Block are of course bustling. In one Tarrytown tax office, I couldn’t get past the receptionist to talk to accountant Kevin Kay, because, said the receptionist, “we’re crazy right now.”

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Last-minute tax filers might be procrastinating because they expect they will owe, or they might just be waiting for their necessary documents to arrive in the mail.

Kee has noticed companies seem to be getting later and later with their W2 mailings, but by federal law these are due to employees by January 31.

Workers with 1099s should receive them by mid-February. But those employers, Kee said, “always claim they’re not ready.”

“You can complain to the IRS,” she said if you haven’t gotten your required forms by these dates. She said she's also been known to call companies and demand them herself. “I’m not above threatening when I’m representing my client,” she laughed.

If you show up at the tax office empty-handed, there is a searchable database H&R Block and other agencies use containing many companies' W2s, assuming the companies participate in the program. In this case, the individual would need to come to the office simply with their own social security number and the company name.

Kee also wants tax filers now to note changes coming soon. As of January 1, 2014, by federal mandate everyone must have a health insurance policy. As of October of this year, letters will come to citizens from the federal government outlining how to go about navigating these “exchanges” and finding a policy.

"That sounds far away but it's not," Kee said.

What does this mean for tax filers? The federal insurance requirement will be calculated based on earnings from 2012 (filed now in 2013). Those who find themselves still uninsured in 2014 will begin facing penalties.

“At first, the penalty will be insignificant but through time it grows and gets big," Kee said.

However, this penalty-threat may not motivate change for a while. “Frankly, for a long time, the penalty will be less than the cost of insurance, so people will just pay the penalty," Kee said.

New insurance regulations are coming as well to companies with 50-plus workers. For workers, said Kee, this “will make the process of getting insurance easier.”

Kee said the best insurance scenario will come to those who work in small family firms. By law, whatever benefits such an employer grants to themselves, must also be offered to their employees.

Between the complications of “exchanges” to come and the once-looming "fiscal cliff" turned "sequester" now, this tax season has proved a challenging one, Kee said.

“Congress waited until almost midnight at the end of 2012 to finalize the tax code,” she said, which put the IRS on an unprecedented delay. “It was extraordinary" that any returns filed with the IRS in January just sat in their servers until the end of the month, she said.

Many of her clients, knowing that their returns wouldn't yet be processed, didn’t bother coming to file their taxes until February. This threw off the natural rhythm of tax season Kee's become accustomed to through the years.

“The normal flow is skewed this year,” she said. “Now we’re busier later.”

The H&R Block offices are open now daily through April 15, 9 a.m. to 9 p.m., with branches on South Broadway in Tarrytown and in the Arcadian Shopping Center in Ossining.

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