"When should I file my taxes and what are the consequences of not filing on time?"
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When Should I File My Taxes and What Are the Consequences of Not Filing on Time?
In the United States, federal tax returns are due on April 15th of each year. State tax returns may have a different deadline, so it's important to check with your state's tax agency to confirm the due date for your state.
If you are unable to file your taxes by the deadline, an extension can be granted that will give you an additional six months to file your return. You must apply for an extension by the original filing deadline in order to be eligible.
If you fail to file your tax return by the deadline, there can be serious consequences. The IRS may impose penalties and interest charges on any unpaid taxes owed.
The penalty for failing to file a tax return is generally 5% of the unpaid taxes for each month that the return is late, up to a maximum of 25% of the total unpaid taxes. In addition, interest will accrue on the unpaid taxes and penalties until the taxes are paid in full.
If you are due a refund and do not file your return, you may lose the ability to claim that refund. It's important to file your return even if you cannot pay the full amount owed, as the penalty for failing to pay taxes is only 0.5% of the unpaid tax amount per month.
In addition to the financial consequences, failing to file a tax return can also result in legal issues. The IRS has the authority to file a Substitute for Return (SFR) on your behalf, which can result in inflated tax assessments and a lower chance of obtaining a favorable outcome in any disputes with the IRS. Failing to file a tax return can also result in criminal charges being filed.
In summary, it's important to file your tax return by the deadline in order to avoid penalties and interest charges, preserve your ability to claim refunds, and avoid legal issues. If you are unable to file by the deadline, you should request an extension as soon as possible to avoid additional penalties. If you have already missed the deadline, it's important to file your return as soon as possible to minimize any additional penalties and interest charges. If you cannot pay the full amount owed, you may be able to arrange a payment plan with the IRS.
