If you’ve missed the tax deadline, is there a penalty? For 2019, the deadline for filing tax returns was April 15. It was only residents of Massachusetts and Maine were given up to April 17, while disaster victims, those who live abroad, and other citizens were given more time.
If you couldn’t meet this deadline, you had until April 15 to request for an extension. If granted then you would have up to October 15 to file your returns. An extension to file isn’t the same as an extension to pay.
To avoid facing a late fee and accruing interest, you should have already paid your taxes by the deadline.
So what are your next best steps? Find out what to do if you miss the deadline to file your tax return.
What Next If You Didn’t File by the Tax Deadline?
If you are expecting a tax refund then there’s no penalty for late filing. This is because penalties are only applicable in cases where taxes haven’t been paid. When expecting a refund, it means you already overpaid your taxes, so you can’t be penalized.
However, if you owe some tax and you didn’t file your returns, you can still do so but you’ll face penalties and you’ll also have to pay some interest on the amount you owe. The earlier you file the returns the better for you.
You can visit IRS.gov and access the IRS Free File that you can use to file your taxes. The file will be available up to Oct 15.
The following categories of U.S. citizens have more time to pay any tax they owe and file the tax returns:
- Resident aliens who live and work outside the U.S.
- U.S. citizens who live and work outside the country
- Puerto Rico residents
- Support personnel in combat zones
- Military service members
- Some disaster victims
If in 2018, your estimated tax payment and federal income tax withholding fell short of your tax liability for that year then you’ll benefit from tax relief.
The IRS is waiving an estimated tax penalty for those who paid 80 percent or more of their total tax payable during the year. This is done through quarterly estimated tax payments, federal income tax withholding, or a combination of both.
What Happens If You Wait to File?
As stated earlier, failing to file returns while you have some tax to pay leads to penalties and interest on the amount you are yet to pay. These figures add up so quickly and the longer you take, the higher the amount you’ll be required to pay.
Under the law, the penalty for failing to pay is usually 5% of the amount you owe in taxes for each month or part of the month that you delay the payment.
If more than 60 days elapse before you file your return, the minimum penalty you’ll be charged is the lesser between100 percent of the tax due or $210. This means that if your tax due is less than or equal to $210, then the amount of your penalty will be equal to the amount you owe. But if your tax due is more than $210, then your penalty will be $210 or more.
In some cases, you may qualify for penalty relief if you file after the tax deadline. However, this is only possible if you can prove that you tried to pay and/or file a tax return before the due date but you couldn’t because of certain issues beyond your control. You can contact the IRS and explain your case.
If you received any notice, it’s better to check that the information in the notice is accurate and then resolve it. If you do so, you may be exempt from the penalty.
- The penalties that are eligible for relief include:
- If you fail to deposit certain taxes as the law requires
- If you fail to beat the tax deadline
- If you fail to file a tax return
- Other applicable penalties
Note that if you usually pay your taxes and file the tax returns in time, you may also qualify for penalty relief. The tax department will check your tax payment and return history for the last three years and then make a decision on whether you qualify for relief.
There are three types of penalty relief, statutory exception, first-time penalty abatement & administrative waiver, and reasonable cause relief.
Qualifying for a penalty relief doesn’t mean you’ll escape the interest. The IRS doesn’t provide interest relief, so you will have to pay interest until your tax account is fully paid. However, if your penalty is reduced, the related interest will also be reduced.
Do You Owe Any Tax After Tax Deadline or You Need to Make Payment?
To know your tax position, you can view your balance through the IRS website. If you have a balance. you can pay via your credit/debit card, Direct Pay, or you can apply for an online payment plan. Before you can access your online tax account, you’ll have to authenticate your identity using the IRS Secure Access process.
If you submit your tax electronically, you’ll receive immediate confirmation. This is also the case with the Electronic Federal Tax Payment System and Direct Pay. If you wish, you can opt to receive your confirmation through email.
Beat Your Tax Deadline to Be on the Safe Side
You may discover that you made some errors or omitted some things after you had already submitted your returns. An amended return may not be necessary if it was a math error or you forgot to attach a required form or schedule.
The IRS usually corrects math errors, but in some cases, they may notify you about the error via email. If it is about missing schedules or forms, they will send you a letter requesting the same. You can use the IRS’s Interactive Tax Assistant to find out whether you need to file an amended return.
What matters most is to ensure you beat your tax deadline, the rest of the issues can be sorted out. However, if for any reason you may need the services of a Tax Attorney, feel free to contact us.