AICCCA Advises Follow the Five Fs if You Owe Taxes
FAIRFAX, VA - March 13, 2008 — The day that Uncle Sam demands his money is fast approaching and many may owe more than they can pay in full. Association of Independent Consumer Credit Counseling Agencies encourages consumers to face the facts and prepare for how they will meet their tax obligations.
"The most important thing to remember if you owe more in taxes than you can afford to pay is do not ignore the situation," said David Jones, president, Association of Independent Consumer Credit Counseling Agencies. "Penalties and fees will add up quickly if you do not make arrangements to pay."
Follow the Five Fs below if you owe taxes:
Figure out now how much you will owe on April 15. Putting it off will not change the amount due and knowing will help you plan for how you will make the payment. Make your payment on the 15th or you will owe steep penalties and fees.
File for an extension or file your return on or before April 15. Do one or the other even if you can't pay the full amount of your payment. Filing late will result in additional penalties and fees added to your bill.
Fine-tune your budget and determine how much you will save by cutting back on areas such as entertainment and food. You may not be able to save the full amount, but whatever you save is that much less you will need to borrow.
Ferret out the best terms if you must borrow to meet your tax obligation. Your options are a personal loan, an IRS installment plan or an IRS approved credit card (American Express, Discover, MasterCard and VISA). You can also apply for a short term payment extension online with the IRS for no fee if you can pay in full within 120 days.
Factor this year's tax liability into your withholding for 2008 and ensure that you will not be hit with a large tax bill again. If you need to, have an additional amount withheld above and beyond your prescribed withholding.
Founded in 1993, Association of Independent Consumer Credit Counseling Agencies (AICCCA) is a national membership organization, established to promote quality and consistent delivery of credit counseling services. AICCCA and its members are focused on improved creditor relations, efficient processes and advanced technology to best serve clients and creditors. AICCCA members are independent nonprofit agencies that advocate for debtors, counsel millions of consumers annually nationwide and provide debt management services to consumers with excessive unsecured debt. For more information or to contact an AICCCA member office call 866-703-TRUSTAICCCA (866-703-8787) or visit www.aiccca.org.
