Missed the Deadline to file your Federal Tax Return?
Take action now by following these guidelines.
Missing the deadline to file your Federal taxes can turn into a financial nightmare if you're not careful. Acting now can help you avoid expensive fines, penalties and interest.
Pay Estimated Taxes Immediately
Even if you haven't completed your tax return, send an estimated payment. The longer you wait, the more you will owe. Even if what you end up owing is more than what you send now, you'll stop the clock on the amount you do pay. Include an additional 5% in your payment; this is the penalty for not filing your return on time. This penalty continues to go up each month by another 5% for a maximum of 25%. That can be a lot of money depending on how much you owe.
You'll also be hit with a late payment penalty. This charge starts at.5% and can continue up to 25%. Again if you're not sure how much you owe, pay something to avoid accruing much more in penalties.
If you are hit with both penalties - failure to file and failure to pay - in the same month, the IRS may waive part of the fees. But, you will still owe interest charges on the unpaid amount and as penalties accrue, interest is also charged on the penalty amounts. Right now the IRS charges around 5% per year on unpaid taxes, so send what you owe as quickly as you can.
If you're short on cash you can also pay your bill by credit or debit card. The IRS has authorized two online providers to process payments, but it will cost you a service charge.
File an Extension
If you know you're going to owe but you're not quite done with the paperwork, send in Form 4868, Application for Automatic Extension of Time to File. This extension is only for the paperwork but will automatically extend the deadline to send in your return to August 15th. Send your estimated tax payment with this form if you can.
Keep in mind; even though there is no penalty for not filing if you are due a refund, you'll lose that refund if you don't file within three years of the due date.
Request an Installment Plan
If the reason you haven't filed is you just can't pay the tax bill, the IRS may be able to help. If you owe less than $10,000 you will automatically be accepted into a payment plan. If you owe less than $25,000 you can make this request online. Those that owe more than $25,000 must file a Request for Installment Agreement to determine eligibility for an installment plan.
File Quickly
Inevitably you must file that return. If you are able to pay immediately, use an online e-file provider to file your return and make your payment. The site will determine your late filing penalties and interest so the appropriate amount is taken out. Then you won't have to worry about the IRS knocking on your door because you missed the filing deadline.
Missing the deadline to file your Federal taxes can turn into a financial nightmare if you're not careful. Acting now can help you avoid expensive fines, penalties and interest.
Pay Estimated Taxes Immediately
Even if you haven't completed your tax return, send an estimated payment. The longer you wait, the more you will owe. Even if what you end up owing is more than what you send now, you'll stop the clock on the amount you do pay. Include an additional 5% in your payment; this is the penalty for not filing your return on time. This penalty continues to go up each month by another 5% for a maximum of 25%. That can be a lot of money depending on how much you owe.
You'll also be hit with a late payment penalty. This charge starts at.5% and can continue up to 25%. Again if you're not sure how much you owe, pay something to avoid accruing much more in penalties.
If you are hit with both penalties - failure to file and failure to pay - in the same month, the IRS may waive part of the fees. But, you will still owe interest charges on the unpaid amount and as penalties accrue, interest is also charged on the penalty amounts. Right now the IRS charges around 5% per year on unpaid taxes, so send what you owe as quickly as you can.
If you're short on cash you can also pay your bill by credit or debit card. The IRS has authorized two online providers to process payments, but it will cost you a service charge.
File an Extension
If you know you're going to owe but you're not quite done with the paperwork, send in Form 4868, Application for Automatic Extension of Time to File. This extension is only for the paperwork but will automatically extend the deadline to send in your return to August 15th. Send your estimated tax payment with this form if you can.
Keep in mind; even though there is no penalty for not filing if you are due a refund, you'll lose that refund if you don't file within three years of the due date.
Request an Installment Plan
If the reason you haven't filed is you just can't pay the tax bill, the IRS may be able to help. If you owe less than $10,000 you will automatically be accepted into a payment plan. If you owe less than $25,000 you can make this request online. Those that owe more than $25,000 must file a Request for Installment Agreement to determine eligibility for an installment plan.
File Quickly
Inevitably you must file that return. If you are able to pay immediately, use an online e-file provider to file your return and make your payment. The site will determine your late filing penalties and interest so the appropriate amount is taken out. Then you won't have to worry about the IRS knocking on your door because you missed the filing deadline.
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