Monday Money Tip: Tax help for veterans, and identity-theft cautions
Tax time can be especially stressful for military families. But servicemen and women are allowed extra time to file and are eligible for free filing help.
Tax time can be especially stressful for military families. But servicemen and women are allowed extra time to file and are eligible for free filing help.
If you're serving outside the United States (including Puerto Rico) as of April 15, 2015, you're granted an automatic two-month extension to file tax returns. If that's not enough time, by submitting Form 4868 to the IRS, you can extend filing by an additional four months, according to the American Armed Forces Mutual Aid Association.
Relief is also available for those in a combat zone. Such service members are granted an automatic 180-day extension to file, and time to pay - which begins once the service member leaves the combat zone.
Free tax-filing help is also available through the Volunteer Income Tax Assistance (VITA). IRS-trained volunteers assist with military-specific tax questions and issues.
Find a VITA site online at http://www.irs.gov/Individuals/Free-Tax-Return-Preparation-for-You-by-Volunteers, or call 1-800-906-9887.
Other sources of aid:
Under the Military OneSource Free Tax Service program, service members can file their 2014 federal tax return and up to three state returns online at no cost through H&R Block.
Active-duty military members can receive the classic edition of TaxSlayer for free.
And there's no penalty on withdrawing money from a 529 plan if your kid attends a U.S. military academy.
The Military Family Tax Relief Act of 2003 provides that a U.S. military academy education will be treated as a scholarship for purposes of the 10 percent penalty on nonqualified withdrawals from a 529 or Coverdell ESA. The value can be withdrawn penalty-free, although the earnings portion will be taxable. If your child has a younger sibling planning to attend college, you can simply change the beneficiary of the account into the sibling's name.
Identity-theft cautions
Since tax time is prime time for identity-theft crimes, here are some red flags indicating you might be a target:
More than one tax return was filed for you.
You owe additional tax, have a refund offset, or have had collection actions taken against you for a year you did not file a tax return.
IRS records indicate you received wages from an employer unknown to you.
If you are a victim of identity theft, file a report with the local police, and the Federal Trade Commission at either www.identitytheft.gov or the FTC Identity Theft Hotline at 1-877-438-4338. Also contact the major credit bureaus to place a fraud alert on your credit.
If your Social Security number is compromised in a tax-related identity theft, contact the IRS Identity Protection Specialized Unit at 1-800-908-4490.