If you were more profitable than you expected to be 4th Q of 2013, or if you didn’t plan ahead, you may be looking at a hefty tax bill. If you’re having trouble figuring out where you’re going to get the money to pay that bill in the next month and a half, a recent Forbes article has some good advice.
- Don’t put off filing. Although it’s tempting to wait until you have the money in hand, you don’t want to have to pay late penalties on top of your tax bill. If you’re severely late, the consequences will be much more severe as well.
- Request a payment plan. You’re not the only person in this boat, and the IRS understands that. If you owe less than $50,000, you can easily apply online for a payment plan. If you owe more than $50,000, it’s a little more complicated. You’ll need Form 9465 and Form 433-F, and you’ll need to get some help filing. (If you know now that you won’t be able to pay your tax bill, we can go ahead and include the 9465 when we prepare and file your return.)
- File separately from your spouse. If you file separately, even if the total is higher than filing jointly, you can always amend the separate to a joint. On the other hand, if you file a joint, you can’t amend it to a separate, and you’ve created liability for your spouse.
Being short on cash to pay your tax bill isn’t something to panic over, but neither is it something to ignore. Take the actions you need to, and even though it might not be fun, you’ll get through it.