Filing a Late Tax Return
You can always file a late tax return, even if you haven’t filed a tax return for several years, or if you’ve never filed a tax return before. However, you may not receive a tax refund when filing a late tax return because refunds typically expire after three years. Instead, focus on submitting late returns as soon as possible so you can catch up with the Internal Revenue Service and protect your potential refunds in the future.
Filing a Late Refund Request
You have three years to file a tax refund request in most cases. The three-year period begins from the date you filed the original return for the tax year. The IRS cannot send you a refund after that time period has expired. For example, a tax refund for the year 2022 will expire on April 18, 2026, which is three years after the original filing deadline of April 18, 2023.
Penalties for Filing Late Returns
Penalties begin if it is determined that you owe the IRS on any tax return that is filed late. The IRS will impose two penalties if you filed your return late, in addition to interest. There is a failure-to-file penalty of up to 5% of the unpaid tax for each month you are late, up to a maximum of 25%. There is also a failure-to-pay penalty of 0.5% per month, also up to a maximum of 25%.
Tips for Catching Up on Late Tax Returns
You will need to obtain a copy of your tax transcript from the IRS to fill in the necessary information on a substitute form, IRS Form 4852, if you do not have your original W-2 forms. Add the form to your tax return and enter the relevant information if you are using tax preparation software. You must also sign Form 4852, and you should attach a copy of the tax transcript so the IRS knows you have a reliable source for the figures you included in your tax return.
Getting Out of Tax Debt
You may find that you owe the IRS when finishing your returns. You will avoid any additional fees or penalties if you can pay the amount due immediately, but you may incur fees if you pay by credit card. The IRS can work with you to reach a payment plan to help you get out of tax debt if you need a little extra time. Approval of the payment plan for taxes owed will depend on whether you are current in your filings and the amount owed. Penalties and interest will continue to accrue until the balance is paid in full, even if the IRS agrees to the plan. You will also incur long-term fees for setting up payment plans, which can be waived if certain conditions are met.
Frequently Asked Questions (FAQs)
What is the penalty for filing quarterly estimated taxes late?
The penalties for missing a quarterly estimated tax payment are similar to not paying the tax due with your annual return. The fees are assessed as a percentage that increases over the time you fail to settle the tax obligation. You can use IRS Form 2210 to calculate the exact penalty.
When can you start filing taxes?
The IRS typically begins accepting returns in late January or early February. In 2023, the IRS began accepting tax returns for 2022 on January 23.
Source: https://www.thebalancemoney.com/filing-a-late-tax-return-3973997
Leave a Reply