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Federal tax extension deadline hits October 15. What you should know

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If you’re one of the roughly 15 million taxpayers who asked the Internal Revenue Service for an extension on filing your federal taxes in April, time’s almost up.

The federal tax extension deadline hits October 15.

By submitting Form 4868 as of April 15, you gave yourself an extra six months to file your taxes. If you miss the October deadline, you’re likely to face a hefty penalty for failing to file. 

More than 1 in 10 taxpayers asked for an extension this year, according to IRS statistics. Typically, taxpayers who asked for one needed more time to gather tax documents or they had complicated taxes that required additional prep work. On top of that, taxpayers are grappling with the ins-and-outs of the new tax code, which President Trump signed into law in December 2017.

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“There were a lot more extensions this year really due to the complexity of the Tax Cuts and Jobs Act,” the law that overhauled the tax code, says Bill Smith, managing director for CBIZ MHM’s National Tax Office. 

He adds, “In October, the key is to make sure you have your documents together. If you are missing anything, you will have to get the documents very quickly — you are running out of time.”

Tax extension due date: What to know

Even though taxpayers who asked for a six-month extension in April have until October 15 to file their returns, some taxpayers mistakenly believe the extension also provides an extra half-year to pay any taxes owed to the IRS, says Lisa Greene-Lewis, a CPA and tax expert with TurboTax. 

“It’s a misconception and we always emphasize that — it’s just an extension to file. The IRS wants you to pay 90% of what you owe” by April 15, she says. 

Taxpayers who owed the IRS should have sent in an estimated payment before the regular tax deadline in the spring. If they didn’t — or low-balled what they owed the taxman — they could be on the hook for an underpayment penalty.

Dealing with an underpayment penalty

If your tax return shows you didn’t pay at least 90% of your tax bill by April 15, the IRS will sock you with a penalty of 0.5% per month on the unpaid amount until the rate reaches 25%, Greene-Lewis says. In other words, it could take about four years to hit that limit — unless you’ve also failed to file your taxes, in which case you’ll face a higher penalty (see below.) The IRS also charges interest on the amount you owe, although the rate varies by quarter.

Of course, estimating correctly can be tricky for taxpayers who hadn’t yet gathered all their documents by the April deadline. Some tax preparers who wanted to help clients avoid the penalty may have overestimated what was owed  by clients who filed extensions, Smith says. 

“If you overpaid, you’ll get it back when we file the return,” he adds. “That’s not the worst thing — the worst thing is there are people right now putting off filing or getting the info they need” to file before October 15.

If you miss the October 15 deadline

Taxpayers who don’t file by October 15 can face even higher penalties, tax experts say. The IRS will sock you with a “failure to file” penalty of 5% a month on your unpaid tax bill for up to five months, maxing out at 25%. If you are facing penalties for both underpayment (see above) and failure to file, the IRS will charge the higher fee of 5% until that penalty hits 25% after five months, but Smith notes that the underpayment penalty will continue to run at 0.5% per month beyond that. 

If you end up owing either penalty, the IRS will calculate your fine after you file your return, says Eric Bronnenkant, head of tax for financial-services firm Betterment.

“Pay what you owe, and let the IRS send you a bill for the amount of interest and penalties that you owe,” Bronnenkant says. “You’ll want to watch for that in the mail.”

If you can’t pay what you owe right away, the IRS will work out a payment plan. You can learn more about those here.

Last-minute retirement savings 

Some business owners and self-employed workers may still be able to sock away retirement savings for the 2018 tax year if they have a simplified employee pension individual retirement account, also known as a SEP-IRA, which is geared toward these workers, tax experts say. 

That’s because SEP-IRAs allow prior-year contributions as late as October 15 — as long as an extension was filed. Traditional and Roth IRAs don’t enjoy this benefit, says Bronnenkant.

And if you qualify for a SEP-IRA but don’t yet have one, you “can set one up today and fund that contribution” before the October deadline, he adds. Because retirement contributions are tax deductible, this can help reduce your tax liability. 

Tax penalty relief

Lastly, the IRS may waive penalties in certain cases, such as taxpayers who have suffered through a natural disaster. But there’s also relief through the agency’s “first-time penalty abatement” program, says CBIZ’s Smith. 

The IRS says this program is open to taxpayers who haven’t paid penalties in the previous three years, among other criteria. You can learn more about the program here. 

Says Smith: “If you have been a good boy or girl, you can get the penalty waved.”



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Kamlesh Tiwari killing: CM Adityanath says murder an act of mischief to create terror, to meet family members today

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Kamlesh Tewari murder caseHindu Samaj Party founder Kamlesh Tewari. He was killed at his office in Lucknow on Friday.

Uttar Pradesh Chief Minister Adityanath has termed the killing of Hindu Samaj Party chief Kamlesh Tiwari an act of mischief to create terror. He said that police officials were probing the case and informed that five people have been taken into custody. He said that such incidents will not be tolerated and those involved will not be spared.

“This is an act of mischief to create terror. In this case, five people have been taken into custody. Of these, three have been taken into custody in Gujarat and two in Uttar Pradesh. A Special Investigation Team has been constituted to probe it,” he said on Saturday.

“The elements who create an atmosphere of fear and terror in the state will be strongly dealt with, and their plans crushed. This type of incident will not be tolerated, and those involved will not be spared,” the CM added.

Adityanath said that the killers were allowed to meet Kamlesh Tiwari by the security guard posted at his residence only after the leader gave him the nod. The killers sat with Tiwari and had food and tea. Subsequently, the personal aide of Tiwari and his son were sent to the market to purchase something. He said that it was during this period that Tiwari was killed by the visitors.

Kamlesh Tiwari, 45, was killed at his home in Lucknow’s Khurshed Bagh on Friday. He was earlier associated with a faction of the Hindu Mahasabha

The Chief Minister will meet the family members of Tiwari on Sunday.

According to Uttar Pradesh Director General of Police DGP OP Singh, five people have been arrested including three in Surat in connection with the murder. He said that the suspects were radicalised and appeared to have targeted Tiwari for his inflammatory remarks made in 2015. Meanwhile, the Anti-Terrorism Squad of Maharashtra police arrested a man from Mominpura locality in Nagpur in connection with the case. The sixth person has been identified as Sayed Asim Ali, 29, who runs a hardware business in Nagpur.

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Boris Johnson sends unsigned letter to EU asking for Brexit delay

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Prime Minister Boris Johnson sent an unsigned letter to the European Union requesting a delay to Britain’s exit from the bloc and also said he did not want the extension after his latest Brexit setback in parliament on Saturday.


Johnson had previously said he would rather be “dead in a ditch” than ask for any extension to the Oct. 31 deadline.



But he was compelled, by a law passed last month by opponents, to send a letter to the bloc asking to push back the deadline to Jan 31 after lawmakers thwarted his attempt to pass his EU divorce deal on Saturday.


A government source said Johnson sent a total of three letters to Donald Tusk, the president of the European Council: a photocopy of the text that the law, known as the Benn Act, forced him to write; a cover note from Britain’s EU envoy saying the government was simply complying with that law; and a third letter in which Johnson said he did not want an extension.


“I have made clear since becoming Prime Minister and made clear to parliament again today, my view, and the Government’s position, that a further extension would damage the interests of the UK and our EU partners, and the relationship between us,” Johnson said in the third letter, published on Twitter by the Financial Times’ Brussels correspondent.


Johnson, for whom delivering Brexit is key to his plan to hold an early election, said he was confident that the process of getting the Brexit legislation through Britain’s parliament would be completed before Oct. 31, according to the letter.


Tusk said he had received the request from Johnson.


“I will now start consulting EU leaders on how to react,” he said on Twitter.


French President Emmanuel Macron told Johnson that Paris needed swift clarification on the situation after Saturday’s vote, an official at the French presidency told Reuters.


“He signalled a delay would be in no one’s interest,” the official said.


However, it was unlikely that the EU’s 27 members states would refuse Britain’s delay request.


Johnson plan tipped on head


Johnson had hoped that Saturday would see recalcitrant lawmakers finally back the divorce deal he agreed with EU leaders this week and end three years of political deadlock since the 2016 referendum vote to leave the bloc.


Instead, lawmakers voted 322 to 306 in favour of an amendment that turned Johnson’s planned finale on its head by obliging him to ask the EU for a delay, and increasing the opportunity for opponents to frustrate Brexit.


Johnson has previously promised that he would take the country out of the bloc on Oct. 31, without explaining how he would do this while also complying with the Benn Act.


“I will not negotiate a delay with the EU and neither does the law compel me to do so,” he told parliament after lawmakers backed the amendment on Saturday.


Opposition politicians accused him of believing he was above the law.


“Johnson is a Prime Minister who is now treating Parliament and the Courts with contempt,” John McDonnell, the opposition Labour Party’s finance spokesman said.


“His juvenile refusal to even sign the letter confirms what we always suspected that Johnson with his arrogant sense of entitlement considers he is above the law and above accountability.”


Scotland’s highest court is due to consider on Monday a legal challenge that had sought to force Johnson to comply with the Benn Act. The court said earlier this month that government lawyers had given formal legal statements that he would abide by the Benn Act and it would be a serious matter if he did not.


“Boris Johnson promised #Scottish court he would comply with #BennAct & not seek to frustrate it. Looks like he’s breaking both promises,” Joanna Cherry, a Scottish National Party lawmaker involved in the case said on Twitter.





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Trump Admin Officials Line Up To Testify About Giuliani And Pals

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A bevy of current and former Trump administration officials have come forward to testify against the president.
They claim President Donald Trump used Rudy Giuliani and others to gut and politicize federal agencies to suit his needs.
According to Business Insider, chief among those is the US State Department.
Testimony reveals they were used to circumvent career diplomats and carry out a shadow foreign-policy agenda with respect to Ukraine.
At least eight officials have, or are scheduled to, testify. One is Marie Yovanovitch, the US’s former ambassador to Ukraine.
Also, Fiona Hill, former WH senior director for Russian and Eurasian affairs.
And Michael McKinley, a former senior adviser to Secretary of State Mike Pompeo.
Finally, Kurt Volker, the US’s former special representative to Ukraine is also scheduled to testify.
https://www.businessinsider.com/trump-officials-reveal-state-department-ukraine-impeachment-2019-10
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