Penalties for Late Filing
A taxpayer will be issued with penalties and interest charges for any late filings if tax is owed on the late tax return submission.
If a refund is due to the taxpayer then the IRS will not issue any penalties.
It may be necessary to file a late return if you do not have the necessary information to file an accurate tax return by the due date and you request a time extension from the IRS. However you would still need to pay tax owed by the stated payment date otherwise interest charges will be accrued on any outstanding tax balance.
Late Filing Penalty Amounts
The penalty for late filing a tax return is calculated from the final date the return should have been received by the IRS until the actual date filing occurs.
If you have been granted an extension any penalties would be assessed from the extension date submission date up to when actual filing is received by the IRS.
The tax penalty for late filing is 5% per month on any unpaid tax balance for up to 5 months or 25% total; the maximum penalty limit is 25%.
Late Filing vs Late Payments
It is important to note that filing your income tax return late is not the same as making a late payment on taxes owing.
Articles & Features
You can get some relief from back taxes owed by negotiating a reduction in tax debts with the IRS or an agreement to extend the duration to pay off the tax.
Find out about wage garnishment and how they can be used by the IRS to recover tax debts.
Offer In Compromise
Taxpayers who satisfy certain criteria may receive an offer in compromise or tax reduction from the IRS on their tax liability.