Your taxes are due!
NEW YORK (CNNMoney) — Unless you’ve filed for an extension, today is the last day to get your taxes turned in to the IRS.
Once the clock strikes midnight, those who owe will start accruing penalties — which can range as high as 25% of your total tax bill.
Tuesday also happens to be Tax Freedom Day, the day when the average American has worked enough days in the year to be freed from their tax burdens, according to the Tax Foundation’s annual report. That means most Americans had to work 107 days just to earn enough money to pay their tax bills this year, and the average taxpayer has spent an average of 29% of their income on federal, state and local taxes in 2012.
Taxpayers were given two extra days to file their taxes this year. While there will surely be a wave of last-minute procrastinators, most taxpayers have already filed. The IRS has received 99 million tax returns so far this season, according to the agency’s latest filing statistics. That’s a 2% increase from this time last year.
Of those taxpayers, about 86 million, or 87%, filed electronically — a 3% jump from last year. Most electronic filers, or 62%, used tax preparers, while 38% filed their taxes on their own.
As more people file, refunds have been slipping. The average refund is $2,794 so far this season — down about 3.5% from last year.
But depending on the credits you’re able to claim, your refund may wind up being much larger than that. The adoption tax credit, for example, gives qualifying taxpayers up to more than $13,000 per adopted child. Meanwhile, the Earned Income Tax Credit gives tens of millions of taxpayers who have low-paying jobs a credit of up to nearly $6,000 based on their income and the number of children they claim as dependents.
There are also several tax perks available for job seekers. If you lost a job or were unemployed during the year, make sure you claimed all of your job search-related expenses, including travel, resume printing and the cost of hiring a headhunter.
Beyond job hunting expenses, taxpayers have been successful at deducting some very unusual items — like carrier pigeons, fake eyelashes and a security bulldog — as business expenses. Just be careful about how far you go when deciding what to deduct. Other attempted write-offs — like a “Playboy” magazine subscription and pole dancing classes — weren’t given the green light.
If the IRS sees something unusual on your return, you could become a prime target for an audit. Red flags include claiming suspiciously high charitable contributions, taking the home office deduction and reporting high levels of income.
While the overall chance of being audited is very low, at 1.1%, your odds of getting hit with an audit rise dramatically the more income you report. The IRS dealt audits to 21% of taxpayers with income between $5 million and $10 million, and 30% of the nation’s highest earners — reporting income of $10 million or more.
And, if you’re flirting with the idea of not turning in your taxes at all, you may want to think twice before using what the IRS considers to be “frivolous” tax evasion arguments, like claiming that tax forms contain the “mark of the beast” or that your state isn’t technically part of the United States. The IRS does not find these amusing, and you could end up going to court and being slapped with big penalties.