What Happens If You Miss the Tax Day Deadline?

What Happens If You Miss the Tax Day Deadline?

The Tax Day deadline is upon us. Your 2023 income taxes are due. April 15 (Unless you live in one of those States with automatic extension.). This means your tax return or your Tax extension Should be either Completed and submitted electronically Or postmarked by midnight tonight.

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For taxpayers who believe they will. Get a refund On their 2023 tax return, the only downside to missing the tax deadline is having the IRS hold your money longer. However, if you owe taxes, you don't want to wait — penalties and interest can add up quickly.

Read on to learn more about what happens to a late tax return, including penalties, interest and information on payment plans. For more, here it is The best software to file your tax returnand learn how to do it. Track your refund to your bank account. After you do.

What if I miss the deadline and am expecting a tax refund?

If you are expecting a refund from the IRS on your 2023 tax return, there is no late filing penalty. in fact, You have three years. To file your 2023 tax return before the IRS turns over your tax refund to the Treasury and your money is gone forever.

Filing late may delay your tax refund, but you should still expect to receive your money within four to six weeks.

You can be To use well Of the money the IRS owes you, and the longer you wait to file your taxes, the more you lose. Whether you use your tax refund to pay Credit card debt, start an emergency fund, invest or even treat yourself to a nice dinner or vacation (depending on your refund amount), you want your money as soon as possible. Letting the IRS hold your tax refund for too long robs you of potential interest and spending power.

What if I miss the deadline and owe money on my taxes?

If you miss the tax deadline, don't file an extension, and owe taxes, there's a good chance you'll incur both late filing penalties and late payment penalties. . You will also have to pay interest on the amount you owe until it is paid in full.

What are the late tax filing fees and penalties?

There are two primary penalties the IRS charges for late tax collection when you owe money: a Penalty for failure to file And a Failure to pay penalty. On top of that, you will too Pay the interest on the amount owed to you.

gave Penalty for failure to file hurts the most. This is usually 5% of the amount you owe for each month or part of a month that repayment is delayed, with a maximum penalty of 25%. If your return is more than 60 days late, the minimum penalty is $435 or the balance of the taxes you owe, if less.

gave Failure to pay penalty It will also cost you money, but not as much — a big reason to file an extension on time even if you can't pay anything. This penalty is usually calculated at 0.5% of any tax due that is not paid by the due date. The IRS then charges a penalty for each month or part of a month that your payment is late, with a maximum penalty of 25%.

The IRS also charges. Interest on late tax. Determined by adding 3% to the short-term federal interest rate, the IRS interest rate is currently 7%. The rate is adjusted quarterly, and the interest is compounded. daily.

Can I file an extension after the tax deadline?

Unfortunately not. A tax extension gives taxpayers six additional months to complete their tax returns, but they must be filed by the tax deadline. Taxpayers filing an extension must also include an estimate of the amount they owe using IRS Form 1040-ES. Online tax software It can also quickly calculate your estimated taxes.

If you want to file a tax extension with the IRS, you must do so by the April 15 deadline. You can submit an extension electronically that day (local time) or by mail by midnight. IRS Form 4868as long as it is postmarked on April 15, 2024.

What if I file an extension on time?

If you file a tax extension by the April 15 deadline, you get six more months. As long as you paid an estimated amount that is close to the amount you owe, you won't incur penalties or fines if you file your return and pay any outstanding tax liability. 15 October 2024.

If you don't pay enough with your tax extension, you may face late payment penalties. The IRS expects your estimated payment to be at least 90% of your total tax liability. If you pay less than this, the agency may charge a penalty of 0.5% per month on the amount of unpaid tax, so you should still complete and file your tax return as soon as possible.

What if I can't afford to pay the taxes I owe?

Having taxes that you don't have money to pay can be incredibly stressful. However, there are steps you can take now that will lighten your financial and psychological burden.

Consider one. IRS Payment Plan. If you can pay off your tax debt within 180 days, the IRS will let you apply for a short-term payment plan that costs nothing, even though you can pay off your debt until you pay it off. Penalties and interest will accrue. It is easy Apply online Or in one Local IRS office.

If you need more than 180 days, you can apply for a long-term payment plan that costs $31 for automatic monthly bank payments by direct debit, or $130 for non-direct debit payments. Is. Low-income taxpayers — those whose gross income is 250 percent or less Federal Poverty Guidelines — Can waive the fee for a Direct Debit installment plan or pay $43 for a non-Direct Debit plan.

You may want to consider other borrowing options outside of the IRS. If your tax liability is not too high, you can use a Credit card with 0% intro APR To pay your taxes, assuming you can pay off the loan before the introductory period ends. For larger tax debts, you may consider a Debt consolidation loanAlthough your rate may be higher than the 7% currently charged by the IRS.

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