Tips to help manage the bill if you owe taxes

It's never good when you find out you owe taxes, and it's even worse when you don't have the money to pay, but there are some ways to help manage that bill.

With stacks and stacks of W2s, tax receipts and other paperwork, it's a hectic time for accountants like Alan Rosen and Michael Schwartz. Many of their clients owe money but can't pay it all at once.

“Their reaction is usually panic," Rosen said. "What do I do? I’m in trouble. Help me."

Schwartz said that's where they come in.

"It’s my job to tell them, 'OK, let’s plan this out,'" Schwartz said.

The accountants said that if you're in that situation, make sure to file on time. If you don’t, the IRS will charge a penalty of 5 percent of what you owe per month plus hefty interest on top of that.

“The IRS has payment plans that may very well help you in your particular financial situation," said Consumer Reports' Tobie Stranger.

The best thing to do is to pay as much as you can by the April deadline, which will minimize penalties and interest. Even if you can pay the full bill within 120 days, Consumer Reports said you’ll still pay penalties and interest on the balance, but you'll avoid the fees associated with an IRS installment plan.

The IRS' plan is more expensive: In addition to a set-up fee, interest and penalties are higher depending on the length of the payment term. The max payment term is six years.

No matter what agreement you come to with the IRS, Schwartz said to make sure you stick to it.

“(If you don't stick to the plan) the IRS considers the agreement null and void and goes after you for the full amount at that point," Schwartz said.

You can also file for an extension, but that only gives you a six-month reprieve from filing the paperwork, and you still need to pay by April 17 what you figure your taxes will be in order to avoid incurring penalties and interest.

Tax day is pushed this year to April 17 because April 15 — the usual tax day — falls on a Sunday, and Washington, D.C., celebrates Emancipation Day on April 16.