Tuesday, March 26, 2024

What If I Missed Tax Day

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How Can I Get An Extension For My Next Tax Return

ITR filing deadline is July 31: What happens if you miss the last date?

If you already know youll need more time to do your taxes in 2023, be sure to file IRS Form 4868 on or before next year’s tax-filing deadline.

  • Again, getting an extension does not give you more time to pay the taxes you owe it only gives you more time to file your tax return. When you file for an extension, you can estimate what you owe and send some or all of that with your extension request. If the estimated payment ends up being less than what you actually owe, youll likely need to pay interest on the difference. The longer thats outstanding, the more interest you may rack up.

  • Dont neglect filing just because you cant pay the bill. The IRS offers installment plans if you cant pay your taxes.

  • Federal: $24.95 to $64.95. Free version available for simple returns only.

  • State: $29.95 to $44.95.

  • All filers get access to Xpert Assist for free until April 7.

Promotion: NerdWallet users get 25% off federal and state filing costs.

  • Federal: $39 to $119. Free version available for simple returns only.

  • State: $49 per state.

  • TurboTax Live packages offer review with a tax expert.

Promotion: NerdWallet users can save up to $15 on TurboTax.

Do I Have To File An Extension With My State

That depends. Once youve requested an extension from the feds, check if youll need to do so for your state. According to the IRS, State filing and payment deadlines vary and are not always the same as the Federal filing and payment deadline.

Some states will automatically give you an extension on your state taxes if you receive a federal extension. In other states, youll need to request an extension separately. The Federation of Tax Administrators offers a rundown of how to check for tax information for the state you live in.

If you live in one of the nine states without personal income tax, youre likely in the clear. However, two of those states New Hampshire and Tennessee still tax investment income, so, if you have earnings from dividends, stock sales or other investments, you may still have to file a state tax return in those states.

Failure To File Penalty

When you dont file your federal tax return by the due date, the IRS charges a failure to file penalty. The penalty is 5% of the unpaid tax, but its reduced by the amount of the failure to pay penalty for any month where both penalties apply .

The failure to pay penalty applies for each full month or part of a month that your return is late for up to five months. If your return is less than 30 days late, youll still be charged a full months penalty.

The IRS also has minimum late filing penalties when returns are filed more than 60 days after the due date. The minimum penalty is the lesser of:

  • 100% of the tax youre required to report on the return that you didnt pay on time
  • A specific dollar amount thats adjusted annually for inflation

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If You Owe Taxes Youll Pay A Penalty And Interest

Keep in mind paying late comes with repercussions. For every month that you file late, youâll have to pay an additional 5 percent penalty on the total amount you owe. Itâs important to note that a month doesnât mean 30 days to the IRS â filing your return even one day late means you’ll still be hit with the full 5 percent penalty. On top of that, youâll also pay interest, which will only add to your fees. And if you file more than 60 days late, things become a bit more complex and costly â another reason to submit your return as soon as you can.

If you canât pay the full amount you owe when you file, paying what you can and looking into payment plans with the IRS is better than paying nothing.

Will The Irs Notice If You File Late

Don

The IRS receives millions of tax returns at the last minute, so you may be wondering if they’ll even notice that yours is a day late.

The real question you should be asking yourself is: Why risk it? Plus, if you mail in your return, the IRS can see the postmarked date on the envelope, so you could very well receive a bill for a small amount if you’re a few days past due.

So if youâre going to be late , make sure to file for an automatic extension. While you’ll still have to fill out and file as much of your 1040 as you can , you’ll have until mid-October to finish the tax-filing process.

This publication is not intended as legal or tax advice. Taxpayers should seek advice based on their particular circumstances from an independent tax advisor.

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Overview Of Basic Irs Filing Requirements

You are only required to file a tax return if you meet specific requirements in a given tax year. The most common reason people need to file is when they earn over the standard deduction which is also referred to as the income filing threshold. For the 2022 tax year, these amounts were as follows:

  • $12,950 for single filers or married taxpayers filing separate returns.
  • $19,400 for head of household filers.
  • $25,900 for married taxpayers filing jointly or qualifying widows.
  • These amounts have fluctuated over the years. They nearly doubled in 2018 with the passage of the Tax Cuts and Jobs Act , and every year, they increase with inflation. If you’re dealing with years of unfiled returns, youll need to find the income filing threshold for the appropriate tax year to determine if you had a filing requirement that year. For example, use the 2016 income filing threshold to decide whether or not you should have filed a tax return in 2016.

    In some cases, you may still need to file a return even when you earned less than the filing threshold amount. Some other reasons you may need to file include the following:

  • You had net self-employment earnings of $400 or more — This refers to your net self-employment income which is your self-employment income minus expenses. For instance, if you earned $1000 in self-employment income and had $700 in business expenses, your net self-employment income is just $300 so it doesn’t trigger a filing requirement.
  • If You Can’t Pay Your Bill

    If you’re unable to cover your tax bill, you may have options, such as a long-term payment plan through the IRS known as an installment agreement. But you must be up to date on all returns, and can’t owe more than $50,000 including tax, penalties and interest.

    Other options may include an offer in compromise for taxpayers with financial difficulties, allowing you to settle with the IRS for less than you owe, or “currently not collectible” status, where the agency temporarily stops trying to collect. But you must meet specific criteria for each one to qualify.

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    What If I Cant Afford To Pay My Taxes

    If you owe more than you can afford to pay, you can request at additional 60 to 90 days to pay in full by either:

    • Filling out the Online Payment Agreement application

    If you do not believe that is enough time to pay your taxes in full, you could also request an installment agreement which would provide at least 120 additional days if you qualify for the short- or long-term repayment plan. Or, depending on your situation, you may be eligible for an offer in compromise.

    Those are all important steps to consider and take, as appropriate.

    If you do not address your owed taxes, it’s essential to know that the collection process could then be triggered. Depending on the situation, this could lead to a levy on your wages or bank account, or you could have a federal tax lien filed against you. A lien would impact your various assets, including your business, if you have one, and could limit your ability to get credit. It may also continue even if you were to file for bankruptcy. It’s crucial to make it clear that you are actively trying to come up with a solution by filling out the appropriate forms and requesting assistance.

    It can be scary when you aren’t sure how you’ll make ends meet, especially during tax season. By being proactive, you can save yourself some of that grief, and you can help set yourself up for better finances. That way, you can move on to the essential steps for building your financial health, like building an emergency fund and getting out of debt.

    What If I Filed An Extension On Time

    Tax Day: What if the IRS doesn’t accept your taxes?

    Well done. You’ve got until Oct. 15, 2022, to file your tax return if you filed a tax extension by the April 18 deadline. As long as you paid an estimated amount that’s close to what you owe, you won’t be subject to fines or penalties if you file your return and pay any remaining tax liability by Oct. 15.

    If you didn’t pay enough money with your tax extension, you may be subject to the late payment penalty. The IRS expects your estimated payment to be at least 90% of your total tax liability. The agency may charge a 0.5% per month penalty on the amount of unpaid taxes if you paid less than that, so you should still complete your tax return and file it as soon as possible.

    Also Check: How Do Taxes Work With Robinhood

    What Happens If I Miss The October Tax Extension Deadline

    If you filed for an extension and miss the deadline:

    • Youll owe more interest. A tax extension gives you more time to file your return, not more time to pay.

    • You may owe a higher late-payment penalty if you didnt pay 90% of your tax liability by the April deadline. The IRS’s late-payment penalty normally is 0.5% per month of the outstanding tax not paid by the filing deadline. The maximum penalty is 25%.

    • You may owe a late-filing penalty. The IRS can also sock you with a late-filing penalty of 5% of the amount due for every month or partial month your tax return is late. The maximum penalty is 25% of the amount due.

    » MORE: You might be able to get out of a first-time IRS penalty.

    Can I Get An Extension Of Time To Pay My Tax

    An extension of time for payment of tax can be filed with the IRS on Form 1127: Application for Extension of Time for Payment of Tax, but the legal requirements are strict:

    • Form 1127 must be received by the IRS on or before the date that the tax is due.
    • You must provide a complete statement of all your assets and liabilities at the end of the last month, and an itemized list of money you received and spent for the three months immediately prior to sending in the extension to pay request.
    • You must demonstrate that paying the tax when due would result in undue hardship simple inconvenience is not enough of a hardship to qualify.
    • You need to show that paying the tax when due would result in a substantial financial loss and that you don’t have the cash, or can’t raise the money, by selling property or through borrowing.

    When approved, extensions to pay are generally limited to six months. Plus, the IRS requires some acceptable form of security before granting an extension of time to pay. The security may be in the form of a bond, notice of lien, mortgage or other means, depending upon individual circumstances.

    There are times when extensions are granted especially due to federally declared disasters. You can check for additional relief information on the IRS Disaster Relief page.

    Also Check: How Much Tax Is Taken Out Of Paycheck In Texas

    State Tax Return Deadlines

    Don’t forget about your state tax return The due date for most state tax returns was April 18. However, eight states âDelaware , Hawaii , Iowa , Louisiana , Maine , , Massachusetts , and Virginia â give you more time to file. Check with the state tax agency where you live to learn more about state tax deadlinesâ¦and about penalties for missing them.

    Penalty Relief After Missing The Tax Deadline

    20 top missed tax deductions

    Some people who are fined for missing the tax filing and payment deadline may qualify for penalty relief. If you’re hit with a penalty, contact the IRS by calling the number on your notice and explain why you couldn’t file and/or pay on time. They may cut you a break if you have a good reason like your house caught on fire, you were seriously ill, and the like.

    If you have a history of filing and paying on time, you may qualify for relief under the IRS’s“first-time penalty abatement” policy . Typically, to have your penalty waived under this policy, you must have filed and paid your taxes on time for the past three years. There are other requirements that you must satisfy, too.

    Recommended Reading: Can I Check My Property Taxes Online

    When Youre Due A Refund

    The IRS wont assess any penalties if youre owed a refund but you should still file your return as close as possible to the filing date. The longer you wait to file, the longer it will take for the IRS to process your return and cut you a check. You should also keep in mind that you cant put off filing your return indefinitely when youre expecting a refund. You only have three years from the filing deadline to get your return in otherwise, you forfeit any cash Uncle Sam owes you.

    If You Owe Pay As Much As You Can To Reduce Penalties

    Although thereâs no penalty for submitting your taxes late when youâre expecting a refund, the IRS may assess penalties if you owe taxes.

    Even if you miss the tax deadline, you should pay as much as possible as soon as you can. Taking this step can reduce any interest or penalties on your tax account, such as the Failure to File or Failure to Pay Penalty.

    If you file your tax return late, the IRS may assess the Failure to File Penalty for failing to pay unpaid tax due on the original due date . Unpaid tax is the tax required to be reported on your return less any withholding, estimated tax payments, and refundable credits.

    The IRS calculates the Failure to File Penalty as 5% of the unpaid taxes for each month that the tax return is late. However, the penalty wonât exceed 25% of your unpaid taxes.

    You may also be assessed a Failure to Pay Penalty if you fail to pay taxes you report on your return by the original due date or an approved extended deadline, such as a federally declared disaster. Taxes that remain unpaid for a month will be assessed a Failure to Pay Penalty of 0.5% per month.

    In months where both the Failure to File and Failure to Pay penalties apply, the Failure to File penalty will be reduced by 0.5% . So instead of a 5% Failure to File Penalty for the month, youâll be charged a 4.5%.

    To get a better understanding of how penalties may affect your account, speak to a tax professional to determine which penalties may apply to your tax situation.

    Don’t Miss: What If You Forgot To File Taxes Last Year

    I Missed The Deadline To File My Taxes Can I File For A Tax Extension

    Yes but only as long as you request to file to file an extension by tax deadline day. Extension requests must be filed no later that the regular due date of your return, the IRS states on its website.

    In other words, the request to file an extension, and the 2022 tax deadline is on the same day: This year, that day is April 18.

    You Missed The Tax Deadline Now What Should You Do

    Tax day is coming soon. An expert answers your questions | Part 2

    If you didn’t file your tax return for 2021, it’s now delinquent. Learn how to resolve your late taxes.

    Peter Butler

    How To writer and editor

    Peter is a writer and editor for the CNET How-To team. He has been covering technology, software, finance, sports and video games since working for @Home Network and Excite in the 1990s. Peter managed reviews and listings for Download.com during the 2000s, and is passionate about software and no-nonsense advice for creators, consumers and investors.

    Yesterday was the federal tax deadline for almost everyone in the US. If you didn’t electronically file your tax return or have a paper return postmarked by midnight April 18, your taxes are now technically late.

    There are plenty of reasons why people might not be able to finish and file their tax returns by the deadline — missing tax info, medical emergencies, family troubles, unexpected travel you know, life.

    Yes, you should have filed a tax extension. But what to do now that your tax return is late? Whether you owe taxes or are expecting a tax refund, the answer is simple — complete and file your 2021 tax return as soon as possible.

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