The deadline for filing your federal return was April 18th. You may face penalties and interest if you file late and owe the IRS. Although falling behind on your taxes can be stressful, it’s not the end of the world. Here’s what to do if you’re filing your taxes late.
Get organized
When it comes to doing your taxes, tracking down all the necessary documents is half the battle. You’ll need your social security number, income statements and any documents that support your deductions. This year, it’s also important to hold on to any IRS notices you received pertaining to the third Economic Impact Payment (Letter 6475) or advance Child Tax Credit payments (Letter 6419). If you’re missing copies of any tax documents, you can request them online at IRS.gov.
Does the IRS penalize you for filing late?
Taxpayers who are entitled to a refund will not be penalized for filing late. However, it’s a different story if you have a balance due. Unless you requested a filing extension, you’ll face two penalties plus interest. The failure-to-file penalty is 5% of the tax owed each month your return is late, up to a maximum of 25%. If your return is more than 60 days late, the minimum penalty is $435 or 100% of your tax bill, whichever is lower. The failure-to-pay penalty is less severe. It’s 0.5% of the tax owed each month it’s late, up to 25%. Requesting an extension only gives you more time to file, it does not give you more time to pay. Late filers should also be aware that your debt will accumulate interest daily until your balance is paid in full. The interest rate is the federal short-term rate plus 3 percent. Even if you can’t afford to pay your entire tax bill, at least file and pay as much as you can to limit the penalties and interest.
Use tax software to file an accurate return
So far, over 117 million taxpayers have e-filed this year. If you’re one of those taxpayers who still files a paper return, it’s time to switch to e-file. Using tax software is convenient, secure and it helps you avoid making a mistake because the program handles the forms and calculations. Do your taxes now at ezTaxReturn.com. They walk you through your return step-by-step, asking simple questions. Just enter the information as it appears on your tax documents and you’re good to go. Most people can e-file in 30 minutes.
Don’t lose your refund by not filing
Even if you aren’t required to file a tax return, it’s a good idea to do so anyway. You may be entitled to a refund for withholding or eligible for tax credits. The only way to find out is to prepare a tax return. Taxpayers have up to three years from the original filing deadline to claim a refund. However, the sooner you file, the faster you’ll get your money. Start your return now at ezTaxReturn.com.
