What You Must Know Before Filing Your Annual Tax Returns To Avoid Penalties

Who needs to file a tax return?

Not everyone needs to file an income tax return each year. Generally, if your total annual income doesn’t exceed the standard deduction (plus one exemption), and you aren’t a dependent of another taxpayer, you don’t need to file a return. There are also income thresholds, below which a tax return is not required.

Filing deadline

Sometimes the returns have to filed with your state or local tax agency, so you should check the rules for your individual state. In any event, they need to be filed by the April 15^th, or the next working day if it falls on a holiday.

Extension

How to file

Payment deadline

If you have to pay ‘estimated tax’ (for example because you are self-employed or have to pay tax on interest or dividends), the payment deadlines are divided into four periods ending on 31^st March, May, August and December. Penalties apply for late payment.