Tax Deadlines And Penalties
If you’re getting a tax refund, you don’t need to panic.
You actually have until April 18, 2019 (or October 17, 2019 if you file an extension) to file with the IRS for your 2015 refund. There will be no penalty since the IRS calculates late filing fees based on the amount of additional taxes you owe. So, $0 x anything= $0. However, after this 3-year period, your unclaimed refunds will be forfeited and kept by the U.S. Treasury. (That being said, it’s a good idea to file an extension anyway in case you end up owing due to an error such as a forgotten W-2 form.)
If you owe additional tax, make sure you file before April 15, 2017. There is no penalty if you file an extension and pay the additional taxes you owe by October 17, 2017.
You will incur a late filing fee if you owe taxes and don’t file your return or extension by April 18, 2017. This will also apply if you file an extension and don’t file your return by October 17, 2016. Per IRS Tax Topic 653, The late filing penalty is 5% of the additional taxes you owe for every month (or fraction of the month) your return is late, up to 25%. If you file more than 60 days after the deadline, the minimum penalty is $135 or 100% of your unpaid taxes, whichever is smaller.
Late Filing Tax Penalties
It’s important to note that even if you can’t pay your tax bill when it’s due, be sure to file on time since the late-filing penalty can be ten times higher than the late-payment penalty, and it only increases as time goes on.
You will incur a late payment penalty if you don’t pay your additional taxes by April 18, 2017, even if you filed an extension. The late payment penalty is 0.5% of the additional taxes you owe for every month (or fraction of the month) that you don’t pay your taxes, up to 25%.
For any month(s) in which both the late-payment and late-filing penalties apply, the 0.5% late-payment penalty is waived.
If this sounds stressful to you, remember you don’t have to go through this process alone! Contact the office of Jeff Cohen to ensure all your tax needs are expertly handled.