As the 2011 tax filing deadlines approach, taxpayers everywhere are extremely busy putting off their tax return preparation. If that sounds like you, or if you have a particularly hairy tax return, the IRS will allow you to apply for an extension of up to six months. It is important to note, however, that this extension allows you extra time to file your income taxes, not to pay them. The IRS still expects you to pay your taxes on time. If you do need the extra time for tax return preparation, however, the application process is an easy one, which you can do at TaxSlayer.com. You will need to file Form 4868. Find it by logging into your account and clicking the link to either start a new tax return or to access your return for the current year. At the very next page, click Edit Return, which will take you to the Main Menu (after you close the Interview Wizard popup). From the Main Menu, click Other Forms from the black pull-down menu. Then click Miscellaneous Forms, and then Application for Extension. That will take you to the Form 4868 page. TaxSlayer will ask you three questions: (1) your tax liability, which is the amount of taxes you owe; (2) your tax payments, which is how much you have paid, such as through withholdings; and (3) the amount of tax payment, or how much you are sending with your application. When you are finished filling out Form 4868, you may file it electronically just as you would file a tax return. You should get an acknowledgement within 24-48 hours of filing to tell you whether the IRS has accepted or rejected your application for extension. You can pay your income taxes either by credit card, or by printing out the form and mailing a check to the IRS.

    Buy over the counter Medication before 2011 If you have a Health Savings Account (HSA) you should use it to make over the counter drug purchases before 2011. Although the money in your HSA rolls over from year to year, starting in 2011 funds that were once eligible to purchase over the counter medication cannot be used to buy them without a prescription. Stock up now while you can! Flexible Spending Account (FSA) "Use it or Lose it" Provision People with FSA's should spend all the money in the accounts before Jan. 1, 2011 or you may be subject to the "use it or lose it" provision.   Taking a loss could actually help If you have a large net capital gain in 2010 you could reduce your tax liability by selling stock that will generate a loss before December 31st, 2010. If legislative action doesn't occur before 2011 capital gains could be taxed by as much as 35%.   Instant tax savings with 401K contributions Now is a great time to consider increasing contributions to your 401K before the New Year. 401K contributions are made pre-tax, which reduces taxable income and possibly your tax bill. You can make changes now for some last minute tax savings and let them roll into 2011 for future savings.   Need a 2010 tax deduction even if you do it in 2011 If you are eligible to deduct Traditional IRA contributions on your 2010 tax return you can do so now until April 18, 2011. This is a great way to lower your 2010 tax bill if you qualify.   Take your First Time Home Buyers Credit Now For eligible home purchases in 2010, taxpayers have the option of claiming the First Time Home buyers credit on either their 2010 tax return or 2009 amended return. Filing an amended return will give eligible taxpayers an option to receive the money now rather than waiting to file for it later.      

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