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How to Prevent IRS Penalties and Delays This Tax Season
- Taxpayers should file on time or seek an extension to minimize penalties and processing delays.
- The IRS imposes separate penalties for late filing and late payment, which can compound if not addressed.
- Filing extensions (Form 4868) buys time to file, but not to pay the full amount due.
- Estimated quarterly tax payments help avoid underpayment penalties for self-employed individuals.
- Penalty relief options include First Time Abate and reasonable cause relief.
- Keeping thorough year-round records helps avoid delays and errors during tax processing.
- Common errors triggering delays include mismatched names, Social Security numbers, and math mistakes.
- The IRS provides tools like 'Where's My Refund' to track refunds and reduce phone inquiries.
- Penalty abatement can be requested with Form 843, potentially removing penalties and related interest.
- A direct debit installment agreement offers a low-cost way to structure long-term payment plans.
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