One of the most dreaded days of the calendar year for many Americans is here! That’s right, the deadline for filing your income tax return is tomorrow April 17th, 2018. If you are not ready to file your federal tax return here is a quick guide to the potential tax penalties you might face. You may be asking yourself, what is the penalty for filing a tax return late?
What is The Penalty For Filing a Tax Return Late?
If you owe taxes and do not file a tax return or file for an extension by tomorrow’s deadline you will incur various penalties and interest. However, penalties generally don’t apply when you are expecting a tax refund and fail to file a tax return.
The penalties for failing to file a tax return or tax extension are much higher than failing to pay taxes owed.
Penalties For Late Tax Payment
At the mention of IRS penalties, you might choose the bury-your-head-in-the-sand option this tax season. However, the penalties and interest for not filing a return or tax extension are notably worse than failing to pay taxes owed.
If you fail to pay at least 90 percent of the full amount owed on time, you will be charged a late payment penalty of .5 percent for each month the tax remains unpaid. This will continue until the tax amount is paid in full or the penalty reaches the maximum 25% penalty.
The .5 percent rate will increase to one percent ten days after the IRS issues the notice of intent to levy.
Penalties For Late Tax Filing
If you fail to file your tax return or tax extension you will be charged 5 percent of the taxes owed each month your return is late. This amount will be capped at 25% after five months of incompliance. The minimum penalty amount for filing your return late is the smaller of $100 or 100 percent of your owed tax amount.
I Need More Time to File My Tax Return?
It is understandable that you have a lot on your plate and meeting this deadline is difficult. If you are unable to file your federal income tax return by tomorrow’s deadline you must file an income tax extension.
What is IRS Extension Form 4868?
IRS Form 4868 is the 1040 extension formally titled the Application for Automatic Extension of Time to File U.S. Individual Income Tax Return. If you need to file tax extension Form 4868, you will need to e-file by midnight tomorrow. If you file by the tax extension deadline, you will receive an additional six months to file your tax return without incurring IRS penalties.
Where Can I File My Tax Extension Online?
You can file tax extension Form 4868 quickly and easily with our sister product ExpressExtension. Their step-by-step interview-style process is equipped with built-in audits to ensure error-free filing. When you file your tax extension online, you will receive a confirmation email within 48 hours notifying you that your IRS extension was accepted.