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Despite the fact that temperatures are rising and Missouri is looking a little greener after the long winter, this is the time of year dreaded by many. If tax season catches you off guard every year, you still have time to carefully prepare your return and get it in on time. You may also be one of the many who expects to owe the IRS, and this may cause you to procrastinate in preparing your returns.
Whether you have filed for an extension on your tax returns or you are facing the regular deadline, keeping on schedule is important to avoiding financial consequences. As much as filing your taxes may make you anxious, missing the deadline can make matters even worse.
When the IRS owes you a refund
April 15 is the deadline for filing the previous year’s tax return, unless that date falls on a holiday or weekend. For 2019, however, the deadline is on a Monday, and the IRS expects to have your return unless you have requested an extension. If you do not owe the government money or are expecting a refund, the IRS is more lenient about missing the date.
In fact, you can file up to three years late if you are getting a refund. Unfortunately, with the new tax laws in place, many who think they are getting money back are shocked to learn they owe money, so assuming you will not owe the IRS could be a risky move. Additionally, if you wait too long to file for your refund, the IRS will consider it unclaimed and keep it.
Missing the deadline when you owe taxes
Things get more complicated when you owe money to the IRS. If you miss the filing deadline or fail to request an extension, the IRS penalizes you 5 percent per month of what you owe up to 25 percent. There is no grace period. The penalties begin on the first day after the deadline. If you wait longer than two months to file, the IRS can impose a penalty up to 100 percent of your tax debt for the year.
This penalty is only for filing your returns late. Even if you get an extension for filing late, the IRS still expects you to pay on time. The fine for paying your tax bill late is .5 percent of what you owe, so it is wise to send as much as you can by the deadline to minimize your penalty. It may also be smart to seek legal assistance if you are confused or in trouble because of your income taxes.