If the IRS sends you a tax bill instead of a refund check don’t panic, there are several ways to manage this and it does not have to be a nightmare for your personal finances.

Sometimes people pay fewer taxes during the year than they are supposed to and that is why the IRS comes back with a bill, but don’t panic. A bill from the IRS does not have to be scary. You just have to manage it like any other part of your finances. Taxpayers have several options. Consider the following:

-You can pay the taxes with a credit card. According to credit card experts such as Cardhub.com, in the current credit environment people with a higher than average credit score could get a credit card with 0% interest rate for more than a year and hundreds of dollars in rewards if they pick the right card.

-It is also possible to call the IRS and establish a payment plan that allows you to pay the tax bill over a period of time up to 6 years. However, the IRS will charge an annual 3% rate for financing the debt. Though 3% is a low rate, it is not better than the 0% deal you can get with a good reward credit card if you have a great credit score and can get approved for one.

-Getting a reward card can be a strategic move for your finances. A reward card is not the usual credit card most people have in their wallets. A reward card can become a cash generator for you if you manage to use it the right way.

-After paying the tax bill with the card, focus only on paying the balance as fast as possible or within the 0% introductory period the card provides. That way you won’t pay any financing charges.

-Once the tax bill is paid and you have a credit card ready to use for other expenses, change your behavior and whatever you spend during the month pay it in full at the end of each period. That way you won’t pay finance charges and you will also accumulate miles or rewards. You can use the rewards in many ways such as purchasing from your favorite stores or to pay for airline tickets or hotels.

-Credit Cards with rewards can generate more benefits than costs.

If you don’t have the credit score to get a reward card ,the best way to pay the tax bill is by establishing a payment plan with the IRS. You just have to wait until you get the bill in the mail and call the IRS to negotiate a monthly payment. The IRS is quite flexible as they want you to pay. You may have to pay a fee to establish the plan and start paying the next month.

Si el Servicio de Impuestos Internos (IRS) le envía una cuenta en vez de un cheque de devolución, no entre en pánico. Hay varias maneras de manejar esta situación y no es necesariamente una pesadilla para sus finanzas personales.

Algunas veces las personas pagan menos impuestos durante el año de lo que deberían y esa es la razón por la cual llega una cuenta de cobro del IRS. Una cuenta de cobro del IRS no tiene porque asustar. Usted solo tiene que manejar ese asunto como cualquier otro en sus finanzas. Los contribuyentes tienen varias opciones. Tenga en cuenta lo siguiente:

-Usted puede pagar sus impuestos con tarjeta de crédito: De acuerdo con expertos en tarjetas de crédito como Cardhub.com, en el ambiente de crédito actual, las personas con calificación de crédito superior al promedio podrían obtener una tarjeta de crédito con una tasa de interés de 0% durante más de un año y cientos de dólares en premios si seleccionan la tarjeta correcta.

-También es posible llamar al IRS y establecer un plan de pago que le permita pagar la cuenta de impuestos durante un periodo de hasta 6 años. Sin embargo, el IRS le cobrará una tasa de interés anual del 3% por financiar la deuda. Aunque 3% es una tasa baja, no es mejor que la tasa de 0% que puede tener con una tarjeta reward o de premios si es que usted tiene la calificación de crédito que le permita obtener una.

-Obtener una tarjeta de premios puede ser una decisión estratégica para sus finanzas. Una tarjeta de premios (reward card) no es la tarjeta normal que la mayoría de la gente lleva en su billetera. Una tarjeta de premios puede convertirse en un generador de efectivo para usted si la maneja de la manera correcta.

-Después de pagar la cuenta de impuestos con la tarjeta de crédito, enfóquese solo en pagar el saldo de la deuda lo más rápido que pueda o dentro del tiempo de introducción en el que la tasa de interés es de 0%. De esta forma usted no pagará ningún costo de financiación.

-Una vez su cuenta de impuestos está pagada y usted tiene una tarjeta de crédito lista para usar e otros gastos, cambie su comportamiento y todo lo que gaste en el mes, páguelo por completo al final de cada periodo. De esta forma usted no pagará costos financieros y además acumulará premios en forma de millas o puntos. Usted pude usar esos premios para comprar sus productos favoritos o para viajes y hoteles.

-Las tarjetas de crédito con premios (reward card) pueden generar más beneficios que costos.

Si usted no tiene la calificación d crédito para obtener una tarjeta de crédito de premios, la mejor forma de pagar su deuda con e IRS es estableciendo un plan de pago. Solo tiene que esperar hasta que llegue por correo la cuenta de cobro del IRS y llamar al IRS para negociar su forma de pago mensual. El IRS es flexible porque lo que quiere es que los contribuyentes paguen. Seguramente tendrá que pagar un costo para establecer el plan de pago y empezar a pagar al mes siguiente.

Tax deductions come in two major flavors: the standard deduction and itemized deductions. The standard deduction is just that—a standard dollar amount set by the IRS each year. This is the easiest deduction to take because there are no calculations to make, no receipts to gather, and no additional tax forms to prepare. While easy, it may not always be the best choice. That’s where itemized deductions come into play.

Itemized tax deductions require a little more work, but it can also mean a big savings on your total tax bill. For example, in 2009 the standard deduction amount for a married couple filing jointly was $11,400. This is a nice deduction, but if you own a home, make contributions to a retirement account, or made charitable contributions the standard deduction may be less than what you could itemize. In situations like this it obviously makes sense to itemize so that you can maximize your total deduction amount. To itemize your deductions you will need to file 1040 Schedule A.

Itemized deductions fall under these primary categories:

• Medical, dental, prescription drugs, and health care costs
• State and local income taxes or sales taxes
• Property taxes
• Mortgage interest
• Personal property taxes (such as vehicle registration fees)
• Interest paid on certain investments
• Charitable contributions
• Personal losses due to theft or casualty
• Job-related expenses
• Union dues
• Tax preparation fees
• Home office expenses
• Gambling losses

Some Things to Consider

If you do plan on itemizing deductions, there are a few things to consider. First, many deductions are limited to a certain threshold amount. A common example of this is in relation to health care expenses. These expenses are deductible only if they exceed 7.5 percent of your adjusted gross income. So, you may not have enough health expenses to be able to take advantage of the deduction. There are also limitations in effect for higher income earners and if your income is above the threshold for the year they may be reduced.

In addition, itemizing means careful record keeping. You will need to keep all of your receipts and track the expenses you’d like to deduct. In the event of an audit you’d be required to substantiate your deductions, so keeping careful records is crucial.

Now that the dust has settled, what does this mean for you? Here are some of the changes that you should be aware of:

• Tax Rates remain the same for 2011 and 2012: The six federal income tax rates will remain at the same levels they are today: 10%, 15%, 25%, 28%, 33% and 35%. In addition, itemized deductions will continue to be allowed in full for high-income taxpayers.
• AMT extension: More than 20 million taxpayers will be spared from having to pay the Alternative Minimum Tax.
• Unemployment benefits: Unemployed taxpayers get a 13-month extension of the deadline to file for additional unemployment benefits.
• Social Security: Workers will get a 2 percentage-point break on their payroll tax for one year. Instead of paying 6.2% on wages up to $106,800, they will only have to pay 4.2% in 2011. This tax break replaces the Making Work Pay credit, which expires at the end of 2010.
• Child Tax Credit: The bill retains the $1,000 child tax credit and reduces the minimum earnings threshold, which allows more people to claim the refundable credit (meaning you get the credit even if you owe no tax.
• Relief of ‘marriage penalty’: The bill continues to ensure that the standard deduction for couples is exactly twice that for single filers. It also maintains an expanded 15% tax bracket so that the amount of income in that bracket for joint filers is exactly double that for single filers.
• Expanded college credit: Paying for college tuition in 2011 and 2012 will be a bit easier with the retention of the American Opportunity tax credit, which allows a credit up to $2500.
• Additional extensions: The legislation extends a number of tax breaks that have been introduced in the past few years such as the option to deduct on your federal return state and local sales tax instead of state and local income tax. Also, it includes a break for teachers to deduct up to $250 in classroom expenses.

There’s still time – but you’d better move quickly – to save on this year’s taxes. A few simple tips to save you money:

• Make your home more energy efficient. Slash your tax bill by $1,500 and save money on each utility bill.
• Donate to charity. Giving back could pay you back in terms of a bigger refund and is a great way to give back to the community.
• Max out your retirement contributions. Some can save you bucks on your 2010 return and help your retirement nest egg grow tax free.
• Use your flexible spending account funds. Any money you have in these accounts must be spend or lost. Over the counter drugs will no longer be eligible in 2011, so now is a good time to purchase those medications.
• Invest in your child or grandchild’s college education by contributing to a 529 college savings plan. In some cases, these can lower your state taxes.

TurboTax is already up-to-date with these tax law changes so you can be confident you’re getting every deduction and credit to which you’re entitled. We understand these changes seem complex, but in reality, TurboTax is designed to identify all the tax breaks for you. It breaks down all these changes, asks you simple questions you can answer easily, and gets you the biggest possible refund.