Published on 28/05/2021
Now that the May 17 Deadline to file your Taxes has passed, wondering what to do next? The good news is that there are no extra charges or penalties on filing your taxes late for those of you expecting a refund from the IRS. People who missed the May 17 deadline and did not request an extension must file their income tax returns at the earliest to avoid hefty fines. File now, and you may stave off paying interest amid a slew of other fines.
Who gets an extension on the deadline?
There is a special clause for select taxpayers that allows them to file and pay their taxes without being charged a late fine or any other penalty.
Individuals in the armed forces in combat zones and contingency operations get an extension of 180 days to file their taxes, pay taxes and claim refunds. This extension of the deadline applies to those in the Armed forces who are deployed outside the country, on active duty, engaged in war, or a national emergency. The same extension also applies to the support personnel engaged in combat zones.
Those hit by disasters and natural calamities are also entitled for getting an extension on the deadline. For instance, individuals affected by the storms and tornadoes that rocked Tennessee early this year. The deadline has been extended to August 2, 2021, for individuals and businesses to file taxes and make requisite payments without getting penalized. An affected taxpayer is someone whose residence or office area located in the covered disaster area was affected due to intense storms and flooding that ravaged major towns.
Filing to get a tax refund
Taxpayers who are expecting a refund from the IRS can file their taxes even after the May 17 deadline has passed. It is also important to remember that there is no other way to get the refund that the Government owes you other than filing the returns. The process is quick, easy, and can be done electronically without having to step out.
Due to the COVID-19 pandemic, there might be delays in processing the paperwork on the IRS’ part. In such a situation, taxpayers must wait for at least 2-3 weeks instead of filing another return. The IRS may take longer to process your return and refund in case of any discrepancies. For ease, taxpayers may use the ‘Where’s My Refund tool on the IRS website to track their tax refund status.
Filing taxes help reduce penalties
The best way to avoid fines and penalties is to file your taxes on time or request an extension to pay your dues. When you file for an extension of the deadline, you get additional time to file your income tax return. Beware, the extension does not apply to paying the taxes. You must pay your taxes before the deadline even if you apply for an extension to file your taxes.
The pandemic has led to the loss of employment or pay cuts for millions of people. In such a situation, if you could not afford to pay your taxes before the deadline, you need not fret. Even in such a case, go ahead and file your taxes to limit your penalties. Later, you can figure out how to pay those taxes. Taxpayers may choose from IRS payment plans (short-term or long-term) to pay off their taxes in a staggered manner. The installment method will allow you to pay your dues over a longer time instead of paying it in one chunk.
That said, upon not filing your taxes within the stipulated time (May 17), you will be levied a 5% penalty each month for up to 5 months. If a return has been filed after 60 days of the due date, you may be charged 100% of the unpaid tax or $435, whichever is less. And you do not want penalties on both late-filing and late-paying of taxes.
If you have been a law-abiding taxpayer who paid taxes on time, you may qualify for getting a waiver on penalty charges if you miss out this time.
Taxpayers may file their taxes electronically. All you need is a little bit of time and all relevant documents in one place. To make the process a lot easier, you can get in touch with a tax professional. Talk to us at [email protected] for qualified professional tax filing services.