What Happens If You Miss the Filing Deadline for Your Taxes?
The deadline to file your income taxes this year is April 17, 2018. While some people aren’t required to file a tax return because they fall below the minimum income requirements, the majority of the population has to file. There are many reasons why you might not make it by the April deadline, but that doesn’t mean you shouldn’t take action sooner. If you can’t file on time, you should ask for an extension right away. However, you may still be charged interest and penalties if you owe the IRS money.
File an Extension Right Now
If you’re still waiting on financial documents to include in your tax return, you may not be ready to file just yet. You might also be really behind in your bookkeeping and still trying to sort out your receipts from last year – to prevent that from happening again, you should get your bookkeeping in order for this year. Additionally, it’s a good idea to file for an extension.
To do that, you can go to the IRS website and download form 4868. This form is short and simple to fill out and allows you to get an automatic 6-month extension. That gives you until October 15, 2018 to file that tax return. However, there’s a huge caveat. Even when you ask for an extension, the IRS still expects you to pay your estimated tax liability.
Since you’re required to file your return on time, there are penalties involved if you don’t: late filing and late payment penalties. The late payment penalty is usually 0.5% or 1% of any tax you have not paid by April 17th. The IRS charges this penalty for every month that the tax goes unpaid. The late payment penalty caps out at 25%. If you pay at least 90% of your taxes by the April filing deadline, file the extension, and pay the remaining amount with your return, you don’t have to pay the late penalty.
While the IRS doesn’t like late payments, they like late filings even less. You have to pay 5% of the amount due for each month or part of the month that your return is late. If you wait more than 60 days with filing your return and didn’t file for an extension, the minimum penalty is $210. However, you can attach a statement to your return with a reasonable explanation for filing late, and the IRS may forgive the penalty.
Expecting a Refund?
If you’re expecting a refund, you can relax. There are no penalties for filing your taxes late. The penalties are a percentage of the taxes you owe the IRS. If you don’t owe, the late payment or late filing penalties don’t apply to you. Of course, if you’re getting a refund, there is no reason not to file sooner than later. After all, the sooner you file your return, the sooner you’ll receive your refund. And you can’t wait forever, either.
If the IRS owes you a refund, you have 3 years to claim it. By April 15, 2021, your refund from your 2017 tax return will no longer be available to you. At that point, you’ve made a donation to the Internal Revenue Service. It can be tempting to put filing a tax return on your list of things to do later, especially since you have 3 years to do it. However, you’ll probably forget it about until it’s too late, which would be a shame. Therefore, you should take your tax records and bring them to us, and we’ll help you get your refund.
What If You Can’t Pay?
You know there’s a deadline, and you know you have to pay your taxes. But what if you just can’t pay right now? There could be any number of possible reasons why you might have trouble making your tax payment this year. We can help you for next year by calculating your withholdings to avoid owing a large balance due in April next year. But what should you do about your taxes this year?
First of all, you should file on time to avoid the penalties for late filing. These penalties add up much faster than late payment penalties. Second, you should pay as much as you can right now. The less you still owe the IRS, the less you have to pay in penalties. Then you need to make payment arrangements with the IRS, which can be done conveniently online.
Camputaro and Associates
Certified Public Accounting Firm
136 N. Orchard Street, Suite 8
Ormond Beach, FL 32174