Life can be hectic—and if you’ve found yourself in a place where you’re going to meet the federal tax filing deadline you may be wondering how you’ll be impacted. For this blog post we wanted to discuss some of the things that could happen if you file late.
First things first: File for an extension
If you need more time to file your federal tax return, the first thing you’ll want to do is file for an extension.
Although filing for an extension will not give you additional time to pay monies you may owe to Uncle Sam, it can reduce your late filing penalties. For example, taxpayers who file for an extension will be “on time” if they file by October 15, and, if they file before the deadline, they’ll avoid the 0.5% (per month) late-filing penalty. However, if an individual files by the extension date and it’s determined they owe money to the IRS, they’ll still be assessed a 0.5% late-payment penalty.
You can file for a tax extension for free, online, via the IRS website. Most extensions are granted automatically.
If you think you owe money on your taxes, pay what you can
If you think you owe money to the IRS, it can be tempting to put off paying it until you can pay it in full. Paying what you can today (and each month until you’ve got enough cash to pay the balance in full) can help reduce interest and penalties.
Yes, the late-payment penalty may only be 0.5% per month, but that can add up quickly. If you don’t foresee yourself being able to pay off what you owe in the near future, contact the IRS to discuss payment plan options. Individuals who opt for payment plans will still be subject to interest and penalties, however, as long as they make their payments on time, they won’t need to worry about additional collections actions, such as having their paycheck garnished or being subject to liens or levies.
Have additional questions? Call Hughes, Snell & Co., P.A. today to speak with an expert
If you’re concerned about missing this year’s tax filing deadline, we can help. Call the office of Hughes, Snell & Co., P.A. today to schedule a free, no-obligation consultation. Not only can we help you understand how tax filing extensions work, if you think you owe money to the IRS, we can help you understand how to minimize late-payment penalties and fees. Are you ready to get started? Call us today to speak with an expert.
