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What Is Late Filing and What Can You Do About It?

One-third of Americans file their taxes at the last minute.

If your taxes are fairly straightforward, that might not be a big deal — simply fill in the information and go! However, what if your taxes are more complex or you run into some technical challenges that mean you can’t get your taxes to the IRS on time?

That’s when we enter the realm of late filing. So what exactly is late filing and what happens?

What Is Late Filing?

Late filing is, to put it simply, the act of filing your taxes late. The due date for 2021’s taxes is Monday, April 18th, 2022 — so any submitted after the end of the day on that date, going into the 19th, are considered late.

If you’re mailing your taxes, your mail must be postmarked on this date or before. As long as you’ve actually mailed them on time, it doesn’t matter if they’ve reached the IRS by the due date.

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What Happens if I’m Late?

If you’re filing taxes late, then you can expect to get hit with some late filing penalties that will increase over time.

The failure-to-file penalty is currently 5% of the unpaid taxes for each month you’re late — and any part of a month you’re late is rounded up. The penalty is capped at 25% of your unpaid taxes.

If you owe a significant amount, this number can really add up.

If you’re expecting a refund, however, you won’t have to pay this penalty. This only applies if you actually owe the IRS money.

Using sites like eFile 360 can help get your tax return to the IRS on time. Make sure you’re aware of all the resources available to you and get it done on time, as the IRS is unlikely to relent on these fees. Avoiding tax penalties is near enough impossible if you don’t communicate with the IRS.

Can I Get an Extension?

You can usually get an automatic extension by sending a form to the IRS. This will give you until October to file, though you’ll still need to pay your estimated taxes to get it.

What if I Can’t Afford My Taxes on the Due Date?

Some people are late because they know they’re about to get hit with a hefty bill and can’t afford to pay it.

In this case, you should file the taxes without payment and ask the IRS for a payment plan. For those with manageable bills that don’t go into the hundreds of thousands, the IRS offers automatic short-term and long-term payment plans.

Taking one of these out is much better than being late because you didn’t file at all.

Try to File on Time

The best thing you can do is avoid late filing by making sure you get your taxes to the IRS on time. If you need an extension or a payment plan, it’s better to communicate and ask than let the fees pile up because you didn’t communicate your needs.

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