The federal income tax deadline has passed for most taxpayers. The IRS estimates 15-million taxpayers will request an extension of time to file, so if you missed the deadline you are not alone. We’ve got helpful answers to some of your top tax deadline questions.
What if I missed the tax deadline?
If you have a refund coming missing the deadline is not as urgent. Just try and get it done as soon as possible. Anyone who didn’t file and owes tax should file a return as soon as they can and pay as much as they can to reduce penalties and interest.
If you need to file an extension do it right now. Anyone can request an extension until October 17, using Form 4868, Application for Automatic Extension of Time to File U.S. Individual Income Tax Return. Remember, an extension of time to file is not an extension of time to pay. Taxpayers must estimate their tax liability on the form.
The longer you wait to file, the more money you might owe. Anyone who didn’t file and owes tax should file a return as soon as possible and pay as much as possible to reduce penalties and interest.
What if I can’t pay the taxes I owe?
Don’t panic if you can’t pay the taxes you owe you may qualify for a self-service, online payment plan, including an installment agreement, that allows you to pay off the balance over time. Once your online application is complete, you’ll receive notification of whether your payment plan has been approved without having to call or write to the IRS. Online payment plans are processed more quickly than requests submitted with electronically filed tax returns, even if the new tax is not yet assessed.
Taxpayers can also request more time by paying all or part of their estimated income tax due and indicate that the payment is for an extension. They can do this using Direct Pay, the Electronic Federal Tax Payment System (EFTPS), or a debit, credit card or digital wallet. This way they don’t have to file a separate extension form and will receive a confirmation number for their records.
Filing soon is especially important because the late-filing penalty on unpaid taxes adds up quickly. Alternatively, taxpayers who have a history of filing and paying on time sometimes qualify for penalty relief.
What are the fees and penalties for filing taxes late?
If you file late and you owe money, you could be hit with a failure-to-file penalty and a failure-to-pay penalty. You’ll also pay interest on the amount you owe.
The IRS says the failure-to-file penalty is generally 5% of the amount you owe for each month or part of a month that your return is late, with a maximum penalty of 25%. If your return is more than 60 days late, the minimum penalty is $435 or the balance of your taxes due, if less than that.
The failure-to-pay penalty is usually calculated at 0.5% of any taxes owed that aren’t paid by the deadline. The IRS again charges the penalty for each month your payment is late, with a maximum 25% penalty total.
The IRS also charges interest on late taxes. Determined by adding 3% to the short-term federal interest rate, the IRS interest rate is currently 4%. That rate is adjusted quarterly, and interest is compounded daily. If after 5 months you still haven’t paid, the Failure to File Penalty will max out, but the Failure to Pay Penalty continues until the tax is paid, up to its maximum of 25% of the unpaid tax as of the due date.
What if I don’t file a tax return, but expect a refund?
Some people may choose not to file a tax return because they didn’t earn enough money to be required to file. Generally, they won’t receive a penalty if they are owed a refund. However, they may miss out on receiving a refund.
There’s no penalty for filing a late return if a refund is due. Penalties and interest only accrue on unfiled returns of taxpayers who don’t pay by the deadline.
For those that file right now, the IRS says it’s taking more than 21 days, and up to 90 to 120 days, to issue refunds for tax returns with the Recovery Rebate Credit, Earned Income Tax Credit and Additional Child Tax Credit. You could lose your refund if you don’t file in time.
What if I made a mistake on my taxes?
The IRS will usually correct any math errors on a return and notify the taxpayer by mail. The agency will send a letter requesting any missing forms or schedules. Taxpayers who discover they made mistakes on their tax return can correct them by filing an amended tax return.
Electronic filing options, including IRS Free File, are still available on IRS.gov through October 17, 2022, to prepare and file returns electronically.
How can I track my tax return?
Taxpayers who owe taxes can view their balance, and pay with IRS Direct Pay, or by debit or credit card.
You can track your tax return on the IRS website. The IRS says you should be able to see your return 24 hours after e-filing or four weeks after you mailed your return. Updates are made daily, usually overnight. You can track your amended returns here.