April is Tax Filing Time

Tuesday, April 15, is the deadline for filing certain returns and taking certain tax-related actions. Here are the major deadlines.

• Filing 2013 income tax returns for individuals. If you cannot file your return by this deadline, be sure to file an extension request by April 15. The automatic extension (you don't need to explain to the IRS why you need more time) gives you until October 15, 2014, to file your return. An extension does not, generally, give you more time to pay taxes you still owe. To avoid penalty and interest charges, taxes must be paid by April 15.
• Filing 2013 partnership returns for calendar-year partnerships.
• Filing 2013 income tax returns for calendar-year trusts and estates.
• Filing 2013 annual gift tax returns.
• Making 2013 IRA contributions.
• Paying the first quarterly installment of 2014 individual estimated tax.
• Amending 2010 individual tax returns (unless the 2010 return had a filing extension).
• Original filing of 2010 individual income tax return to claim a refund of taxes. Some taxpayers have tax refunds due them for prior years, and unless a return is filed to claim the refund by the three-year statute of limitations, the refund is lost forever.

Pay Attention to Your MAGI to Qualify for Tax Breaks

Take a look at your 2013 tax return after it's prepared. How close to the edge did you come to losing tax benefits due to tax phase-outs? As you begin your 2014 tax planning, consider the effects of these benefit-limiting provisions, many of which are based on modified adjusted gross income, or MAGI. Knowing how close you are to the "edge" can help you preserve tax breaks for 2014.

A caution: Since the definition of MAGI as applicable to individual phase-outs varies, you might have to choose between conflicting opportunities. For instance, if you have a child in college this semester, the American Opportunity Credit and the Lifetime Learning Credit may be on your mind. Both benefits are education-related, yet the qualifying requirements differ - including the MAGI threshold.

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Financial Tips for the 20-something Generation

The earlier you start, the easier it will be to get ahead financially. Here are some recommendations for those in their early twenties.

Pay yourself first. Every time you get paid, put something aside in a savings or investment account. As a general rule, save 10% of your income. Even smaller amounts add up over time.

Watch your plastic. Credit cards are an expensive form of debt, and it's easy to lose control of them. Try to pay your entire credit balance every month, even if it's a stretch. If you've been carrying a balance, buy nothing more on credit until the balance is zero.

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