Head of household is a filing status for single or unmarried taxpayers who have maintained a home for a qualifying person, such as a child or relative.
This filing status provides a larger standard deduction and more generous tax rates for calculating federal income tax than the Single filing status. Do you earn an income in Louisiana? If you answered yes, read on to find out more about how and when to pay your LA income tax.
This link is to make the transition more convenient for you. You should know that we do not endorse or guarantee any products or services you may view on other sites. Tax information center : Filing. Why do I owe taxes this year? Here are a few ways job and policy changes might have impacted your taxes. Claiming unemployment — Americans are claiming unemployment benefits in higher numbers than ever before due to coronavirus. When you file, you should include unemployment income on your tax return.
You can also get an expert to evaluate your situation and identify your best solution. Advantages or disadvantages: If you set up an installment agreement, the penalty on your unpaid balance reduces to 0. You can pay through payroll deductions Form , Payroll Deduction Agreement. Related: Does an installment plan or IRS debt show up on a credit report? Find out from our experts. There is a penalty of 0. Action required: Complete an online payment agreement , call the IRS at or get an expert to handle it for you.
Advantages or disadvantages: This option is convenient for taxpayers who need a short time to pay their full tax bill. With short-term extensions, you avoid the installment payment application fee see 1 , but not late-payment penalties and interest. The IRS offers options for people in hardship situations, including currently not collectible status and the offer in compromise. You must include a statement of your assets and liabilities.
You could ask a personal contact — maybe a friend or family member — to loan you the money. Fees and cost will vary widely depending on the source. This could be an inexpensive option, but you should use your best judgement. Fee or cost: There is a possible minimal fee. The plan must also charge interest. Advantages or disadvantages: This type of payment is convenient and gives taxpayers greater control and flexibility for making payments.
They may also earn points, miles, or other credit card rewards. An IRS levy initiates the legal seizure of your assets in order to satisfy your outstanding tax debt.
Levies come in many forms and may include garnishing your wages via your employer, seizing your assets directly from a bank account, or seizing and selling your property such as a vehicle or a home.
In the most extreme cases, the IRS may pursue criminal charges against you for tax evasion. Deliberately avoiding paying your tax liability, more commonly referred to as tax evasion, is a serious crime with a penalty of up to five years in jail. Although this final step is often reserved for the most serious tax evasion cases with large outstanding balances, it is best to err on the side of caution. If you get an initial letter for late payment, set up a plan with the IRS to get your taxes paid as soon as possible.
Here are a few ways to get you out of your predicament. You could also apply for a debt consolidation loan from a bank or credit union. If you choose one of these options, you'll have made good with the government, but you'll be shifting your debt to an expensive source. Unless you have a credit card with a very low annual percentage rate APR or are able to secure a personal loan at a very low interest rate, you might be making your long-term situation worse.
Filing a six-month tax-filing extension using Form won't help. This extension only gives you more time to file your paperwork; it doesn't give you more time to pay what you owe. Filing your return on time can help minimize the penalty and interest charges assessed by the IRS. The IRS's late payment penalty is 0.
So simply filing your return on time can save you a substantial amount in penalties. If you believe you have a legitimate case due to undue hardship, you can file Form to request a six-month payment extension. Along with this form, you'll have to submit a statement of all your current assets and liabilities and an itemized statement of all the money you've received and spent in the last three months. The IRS rarely grants payment extensions, and it will only be granted if you can demonstrate undue hardship.
If you think it will take you more than a few months to pay your tax liability, consider applying for an installment agreement. You can apply online at IRS. An installment agreement can prevent the IRS from taking enforced collection action. You'll still owe penalties and interest, but your monthly payments let the IRS know that you intend to make good on what you owe. If you have an emergency fund, this is a good time to dip into those savings. You can use your emergency fund as an interest-free loan to yourself to pay off your tax bill and then start replenishing your fund with each paycheck.
If you own a home and you have enough equity, another way to borrow from yourself is with a home equity line of credit HELOC. These loans have relatively low interest rates compared to credit cards and personal loans. The downside is that your house serves as collateral. Defaulting on a home equity loan or HELOC is like defaulting on your mortgage—it can cause you to lose your house. However, borrowing money this way will turn the large lump sum you owe the IRS into a manageable monthly payment to a mortgage lender.
Another option is to borrow from a retirement account like a k or IRA. It also damages your retirement savings plan. Unfortunately, the IRS is going to charge you interest and penalties on any amount you pay late. Like running a balance due on a credit card, these charges are going to make it harder to pay what you owe.
The more you're able to pay on time, the less interest and penalties you'll be assessed. The IRS will eventually send you a bill, but you don't have to wait to get the bill to make additional payments. Pay what you can when you file your return, then send in whatever additional payment you can afford each payday using Form V. Whatever you do, don't ignore the problem. The IRS can freeze your bank accounts; garnish your wages; seize physical assets, such as your car; and place a lien on any assets you own, including your home.
If you find you can't pay what you owe, go ahead and file your return and pay what you can. Then work with the IRS, perhaps with the assistance of a tax professional, to formulate a plan for paying the balance of your tax bill over time. Internal Revenue Service. Accessed Sept.
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