In a last-minute rush? Go with e-filing

HACKENSACK, N.J. - The countdown is on: You've got just until the end of Tuesday, April 15, to file your federal and state income tax returns.

It's a bit late to offer advice on how to limit what you'll have to pay or to increase your refund - with the exception of investing in an individual retirement account, which you can do until April 15 and get credit for 2007.

But here are a couple of tips to help you get through a process that can be intimidating.

For starters, if you haven't done it before, consider filing electronically. It's easy and inexpensive (or free, if you qualify). Plus, by e-filing, you'll get your refund within 10 days and you'll be among the first to get a tax stimulus payment.

Those who have e-filed in the past probably don't need to be convinced to do so again. But you should still spend a few minutes checking out some of the private vendors from among the list of 27 listed on the IRS Web site because there are significant differences in what they offer and charge.

If you have an adjusted gross income under $54,000, there is no fee. Go to IRS.gov, click on the "Free File" button and follow the instructions.

If your adjusted income is more than $54,000, you'll have to pay, but you'll find several vendors to handle your federal and state returns for less than $10. Others charge extra for state returns, and that can push the tab over $25 for essentially the same service.

A few other things to look for:

Most services prepare federal and state returns, but some handle federal returns only. Some do a single state only; others do multiple-state returns.

Make sure the software can handle your return. Most services cover all the basics, but they may not be able to handle special credits or deductions such as adoption credits, foreign employment income or casualty losses, or itemized deductions at all.

All sell extra services, such as mailing you printed copies of the return. Decide if you need them.

There's no question that e-filing is growing in popularity. This year the IRS is projecting that 76 million people nationally will e-file.

But even with e-filing, it's possible to make mistakes.

J. Gregg Rollins, president and chief executive officer of CitizenTax.com, an Internal Revenue Service-authorized e-filing provider, cautions that attention to detail is important here, too.

Rollins notes some surprising e-filing mistakes: "Not entering the correct Social Security number and date-of-birth for the e-filer and his dependents top the list."

Other common errors include submitting the wrong last name for the filer, that person's spouse or their children.

Entering an incorrect bank routing and bank account number is also another frequent mistake made by e-filers. "Your refund will be delayed if that happens," Rollins warns.

Before sitting down to start on taxes, Rollins offers some common-sense advice: "Read the instructions. Many people skip this step, but such shortcuts can waste time in the long run and also cost you money."

He adds these tips to make e-filing of taxes at a late date a less-stressful experience:

Determine which tax forms you need before selecting a service. Not all e-file providers provide the forms that a taxpayer may need to accurately complete his return.

Divorced or Separated Parents. If you and a divorced or separated spouse share custody, pay careful attention to properly completing the dependent section. Be sure to correctly list the tax credit that you're entitled to and that neither parent "double-claims" a credit pertaining to the off-spring.

Get organized. Make sure your W-2s and 1099s are accurate, get your ID numbers straight and write down your Social Security numbers exactly as they appear.

Also, Rollins says, if your e-filed return is not accepted because of error, there is a short window of opportunity, usually a few days, to make corrections, resubmit and avoid interest and penalties that may be due.

To avoid the hassle, start the process now, advises Rollins. Late returns filed after April 15th without an extension are subject to greater scrutiny by the IRS.

Your tax filing - whether electronic or on paper - is also the key to receiving your economic stimulus payment.

To get your cut, you need do very little. File your federal return by April 15 and, if you're eligible, you'll automatically get your share of the $168 billion pie.

If you are getting your 2007 income tax refund through direct deposit, you'll also get your stimulus payment that way, starting on May 2.

All others will receive their money by check, beginning May 16 and continuing until July 11. Late filers will wait even longer.

Payments will be staggered, based on the last two digits of your Social Security number.

It doesn't make much difference on direct deposits, as all payments will go out by May 16. But paper checks will go out in nine separate mailings, with taxpayers with an SSN ending in 88 to 99 having to wait until mid-July.

If filing jointly, you can speed the process by listing the spouse with the lower number first on your return. Remember: Only the last two digits matter.

Most payments will be $300 or $600 ($1,200 for couples), with an additional $300 for each child.

But not everyone will get a rebate. Payments are phased out for singles earning more than $75,000 and couples over $150,000.

If in doubt, try the online calculator on IRS.gov. It will help you determine whether you're eligible and how much you can expect.