4 steps to take now if you missed the tax filing deadline
Thursday, April 21, 2016
Even with three extra days to complete taxes this year, some folks missed the April 18 (or 19) tax filing deadline.
Did you just give up on tax filing this year? You need to get a return to the IRS ASAP or you'll pay the price.
Maybe a personal emergency took precedence. Perhaps you meant to get the job done, but it took longer than you planned and exasperated, you just said, "Later!" Or you discovered you owe, but don't have the money and thought, "What's the point?"
The point, regardless of why you didn't get your Form 1040 (or Form 4868 to get a six-month extension) to the Internal Revenue Service on time, is that your continued procrastination could cost you. Big time.
As the first Weekly Tax Tip of 2016 -- yes, this regular blog feature began its latest run on Wednesday -- notes, the IRS is serious about hearing from you each April. It imposes three main filing-related penalties, the harshest of which is for not filing.
If you're in that position now, don't panic. But do take these 4 late-filing steps ASAP.
1. File a return: Get the IRS a return. Now.
Complete it as thoroughly as you can. If you have to amend it later, then do that. But right now you need to get something into the system that will show the tax man that you realize you have a tax responsibility and you're doing your best to meet it.
Once the IRS has your 1040 in hand, the non-filing penalty stops.
The fastest way to file is electronically. And if you qualify for Free File -- adjusted gross income cap this year is $62,000 -- that option is still available.
2. Pay what you can: If you can't pay you full tax due, don't worry. The IRS is happy to take as much as you can pay when you file.
Paying even a portion of your tax bill will reduce the amount that's subject to the non-payment penalty and interest.
Again, going electronic helps you settle up with Uncle Sam more quickly. You have several e-payment options.
3. Set up a payment plan: To cover your full tax-due balance, look into a payment plan.
You can up an installment plan directly with the IRS, either by sending the agency Form 9465, Installment Agreement Request, or by using the IRS' Online Payment Agreement Application.
4. File your state returns, too: Most of the 43 states and District of Columbia that collect income taxes use taxpayers' federal returns as the basis for state filings.
That probably means that if you haven't completed your 1040 for the IRS, then you probably didn't file your state taxes either.
Each state has its own rules and penalties for late- and non-filers, but they all mean that the longer you put off that tax task, the more you'll owe your state tax collector, too.
Don't owe? Don't worry: If you don't owe the U.S. Treasury any taxes, then you can take a breath.
While technically you are in violation of the federal tax filing requirement when you don't submit a return, it won't cost you. Penalties are assessed based on any tax you owe.
But if you are getting a refund and haven't filed, what are you waiting for? The IRS isn't going to send the money to you. You have to ask the agency for your overpaid tax money.
So regardless of whether you owe or are getting a refund, get your return to the IRS, and your state tax office, as quickly as you can.
With taxes, it truly is better late than never.
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