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Tax Season Anxiety: Last-Minute Tips to Save Your Sanity

As the tax filing deadline approaches, many of us are scrambling to get our finances in order. The thought of making a mistake or incurring penalties can be overwhelming, especially for freelancers who are responsible for their own taxes.

The Importance of Filing on Time

With only a few days left to file, it’s crucial to avoid procrastination and potential penalties. Even a 5% penalty may not seem like a lot, but it’s completely avoidable if you file on time. Moreover, waiting until the last minute to file can lead to mistakes, which can be costly and time-consuming to rectify.

Late-in-the-Game Tips for Filing Your Taxes

If you’re running behind, here are a few tips to help you get back on track:

1. Apply for an Extension

Anyone can apply for a tax extension in the United States. Simply submit IRS Tax Form 4868 before the deadline, and you’ll get an extra six months to file your return. Note that you still need to make your tax payments by the original deadline.

2. Choose the Right Filing Option

If you earn less than $64,000 per year, you can file your taxes online for free through the IRS website. Alternatively, consider using services like H&R Block Online Free Edition or TurboTax Online Federal Free Edition, which offer free federal filing for simple tax returns.

3. Consider a Payment Plan

If you owe money on your taxes but can’t pay in full, don’t hesitate to set up a payment plan. You can apply online and make regular monthly payments over time.

4. Plan for Your Refund

When you receive your tax refund, resist the temptation to splurge. Instead, consider saving it for something important, like paying off debt or building an emergency fund. Having a plan in place beforehand will help you make smart financial decisions.

5. Set Yourself Up for Next Year

Take control of your taxes by adjusting your exemptions and withholding. If you’re self-employed or have a side hustle, find a system that works for you to save for taxes throughout the year.

6. Automate Your Savings

Consider using a savings app like Qapital to automatically set aside a percentage of your income for taxes. This way, you’ll avoid the temptation to spend that money and ensure you have enough when tax season rolls around again.

By following these tips, you’ll be well on your way to reducing your tax season anxiety and setting yourself up for financial success in the long run.