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Remember taxes?
It’s easy to procrastinate during the lazy hazy days of summer, but if the topic is taxes, it’s a pastime to figure out a plan. No need to panic, though — you usually have options, even at this late date.
The deadline to file this year was May 17. If you missed the deadline, hopefully, you filed for an extension, but if not, do that now. You can request it for free via Free File on the IRS website, or else contact your accountant — who has probably already been pestering you — ASAP to do so.
Remember that an extension on filing does not equate to an extension on payments, however. If you owe taxes, you should have paid a tax estimate by May 17. Again, you have an option to request an extension. You can request a six-month extension, though you will accrue interest.
If you have children, you’ve got a potential extra incentive to file: You might be able to get an advance on the 2021 child tax credit, which was expanded in the March aid package. This year’s credit is $3,000 per child ages 6-17 and $3,600 for children under six.
Eligible parents can opt to receive up to half of that in payments starting in July. Parents of children under six could receive payments of $300 from July to December, while those with children 6-17 could receive $250 a month.
One caveat? You need to have filed your 2020 return. If you do opt for the installments, you’ll calculate how much of an advance you received when you file your 2021 taxes to receive the remainder.
