Well, here it is – the first full week of April. It’s definitely well within that period of time that tax accountants call “busy season.” There are no exceptions in my household, either.
This article will just be a short reminder that this year’s federal income tax deadline for US taxpayers is April 18, 2011.
As I write this Sunday night (April 3), I ponder its being two weeks away. I’m sure there are others among you, dear readers, who are pondering it as well.
MORE EXTENSION FILERS THIS YEAR?
It does seem as though there are a few more “extension filers” this year. Those are taxpayers who just don’t quite have all the information and calculations complete, ane need additional time for filing their returns. For tax accountant, filing extensions only puts off the inevitable. The “busy season” can lengthen or simply reappear later in the year.
For those US taxpayer who are outside of the USA and need a little extra time, there is a small benefit. Overseas US taxpayers can obtain an additional 2 month extension of time to file their return AND PAY their taxes. How’s that, Paul? you may be asking.
Normally, for US taxpayers residing in the USA, taxes are due on the original filing date – most often, April 15. A taxpayer can obtain additional time to FILE his/her tax return by requesting an extensions of time to file a tax return. With that extension, however, the US taxpayer must include a payment of taxes that are estimated to be due.
For US taxpayers residing overseas, there is an extension of time to FILE and to PAY. This extension is two months in duration. So, overseas taxpayers can pay their taxes two months later (June 15) without incurring a penalty. They will, however, incur interest due for the period of time after the original deadline until the payment date. (Uncle Sam seldom if ever has “freebies” for taxpayers.)
Now, if an overseas taxpayer needs more than two months extension of time to file, he/she may request additional time to file – putting them on equal footing with the USA resident counterparts, enjoying a final filing deadline in October.
I’m sure some of you dear readers are confused. I know my mind is currently spinning. My spin isn’t due to extensions, but those pesky extensions certainly add to the “centrifigul force” keeping the spin going.
FROM TAXES TO TAGAYTAY
I apologize that this is a short, tax-oriented note. I originally planned a short travelogue covering a trip taken last weekend to Tagaytay for a wedding. That sort of fell through.
The main transportation (bus) was taken overnight in both directions. Nothing to see in the dark (outside of Manila traffic), no pictures to snap with the camera; a real bust when trying to assemble a story. Any free time was spent trying to catch up on sleep.
Weather conditions were cloudy, hazy, foggy, etc. Even when nearing the “sights” I couldn’t really see them. I knew the lake and the volcano were out there somewhere in the mist/fog/haze/cloud/whatever. I just couldn’t see them.
The wedding was a splendid affair, held in a beautiful little church atop a mini-mountan. The reception afterward was splendid as well. Plenty of family, new and old acquaintances, etc. kept the atmosphere lively and enjoyable.
My only complaint – we didn’t have enough time to do anything!
A Thursday night bus trip (overnight) down to Manila, a morning of catching some sleep in Antipolo, a trip from Antipolo to Tagaytay, finding and enjoying a good seafood restaurant, finding lodgings for the night, and bedding down for the night made up the first day (Friday). Arising, preparing for and attending the wedding, attending the reception, trying (but failing) to see some sights, a trip back to Manila, an overnight bus trip back north, and getting back home on Sunday morning made up the second day.
It was a whirlwind tour to say the least. How I wish we had spent more time so that I could have presented a more indepth travelogue.
Oh well, there are always the taxes.
Paul, If I read that right, since we live overseas we don’t have to file till the 15 June, and that is without filling out the paper work for an extension.
Hi Bill –
That is correct. Here’s what the IRS has to say about this issue:
“Taxpayers who are out of the country. If, on the regular due date of your return, you are out of the country and a U.S. citizen or resident, you are allowed 2 extra months to file your return and pay any amount due without requesting an extension. For a calendar year return, this is June 15, 2011.”
If you would need additional time to file, then at that time you can file Form 4868, check the box on line 8 (indicating that you are an overseas taxpayer), and receive an additional 4 months to file (due date extended to October 17, 2011). Note that you must pay any amount due with your Form 4868.
The good thing is that I’m getting back so that would not be a problem. I would have filed back in Feb but had to wait for a few things. Plus I need to get TIN’s for the wife, stepchild and new baby. That is what has been keeping me.
Thanks for the post and the info.
Paul;
For the overseas extension that is automatic until June 15, just how does the IRS know where in the world we are?
Hi Paul – A statement regarding the taxpayer’s overseas situation is attached to the return (i.e., the taxpayer was out of the country on the tax due date).
Nothing is easy with taxes! 😉
Paul T.
You didn’t know. The IRS trusts everyone and knows nobody would lie about where there residence is Hahaha. Take care my friend
Paul,
Thanks for helping me out with my taxes. Relatively pain free (except for writing the check to Uncle Sam).
Last year, I didnt file until Dec, mostly due to my prior tax accoutants being too busy to complete it, but then it was my employer so it was free and thus a low priority.
Don
Hi Don – Thanks for letting me help! I’ll keep you advised of any changes that may affect your tax situation for upcoming years.
Yes, tax work seems to go a lot smoother earlier in the year. Guess one reason is that the information for the return is still fresh and doesn’t require secondary or tertiary searches on the taxpayer’s or tax accountant’s part. Too, relying on memory for information that’s been around for nearly a year is more difficult to remember than that only one- or two-months-old.
Thanks again, Don
Next time your in Manila, will let you buy me a beer and can claim as a business expense! Just remember to update me on some new tax law…
Don
😀
I’m waiting ’til 18th because we have to write a check, just using standard deduction here. It really pains me to write a check when it ends up paying almost 20% of income. We could’ve used the fund for a fun 2-week vacation in the Philippines. ^!^ Oh well, it is what is, at least we have income.
Hi Lea – “I feel your pain” – Though I filed my personal tax returns back in late February, I scheduled my tax payment for April 18 and not one moment sooner. I can find much better use for the money over a couple of months!
Of course, a little tax planning coupled with “frugal” quarterly estimated tax payments would keep that final chunk of change from being too large.
And a big YES to your last statement. I really wouldn’t mind paying a millionaire’s income taxes so long as I was the millionaire! The government may take a big bite, but what’s left over is substantially larger. Having the income is most important.
Paul, that’s an idea… I didn’t even think about that. However, here in VI, since we only do paper filing (no-efile), I’m not sure if they will accept it without payment. I guess, I’ll give them a call to find out. ^!^
It’s all payroll income, so, didn’t bother to do estimate. But then again, when we had a refund in previous years, it took a long time to receive the check. Reason?? The VI govt is short of fund! ^!^ Just like the phrase “Only in the Philippines”, we also have it here – “Only in de VI”.
Paul, I may need to speak to you offline at some point. I am visiting here in Dasmarinas Cavite. I have a Trust set-up with my “play” daughter here as one of my beneficiaries. She can receive up to $13,000 a year without a tax implication if in the U.S. She does however, have to fill out a 1099. What is the limit in the Philippines? And what form does she fill out here as a local resident.
My e-mail is: [email protected]
Thanks a million!
Hi Edward – I’ll e-mail you within the next few days. I don’t think we really want to air everything in this venue.
😉
Hi Paul! Your article reminded me of my days with KPMG in Manila many years ago. The last 2 weeks, before tax deadline (usually 15 April), would mean, we do not get home earlier than 9pm, and the weekeend before the deadline, would mean, we get to stay overnight on Saturday and Sunday in the office. On the actual deadline, we sort of acted as “messengers” for the clients filing their FS and ITRs, with their cheques, just so we could meet deadline. Just a good thing to remember, but I do not intend to do it again. I’m glad there is no tax here in the UAE, it is a lot easier here than in the Philippines or other countries. God speed and mabuhay!
Hi Alf – One never forgets those days of busy seasons past! It’s as you say – my first experiences with long days and even longer weekends were with E&Y in the States.
😉
I could never figure out who dragged their feet longer in providing information, though. Consolidated corporations with over 90 companies were no different from high-wealth individuals when it came to waiting until the last minute. Extensions only meant another busy season later in the year.
No matter how difficult the situation, though, I always reminded myself that these taxpayers were putting bread on my table!
😆
What a good motivation, eh?! Very well said! 🙂