Don't worry -- it's not too late yet. As long as you're reading this before April 15. And while the deadline might still be a couple weeks away, we procrastinators know that weeks can disappear quickly.
So, what if you miss the April 15 tax deadline? What if you missed it last year, or haven't filed taxes in a few years? And what if it's not your fault because you didn't get your W-2? We've got all those answers and more for you right here.
This Year's Tax Deadline
While you still have time, what happens if you miss this year's tax deadline? Don't worry -- you're not going to jail if you fail to file your taxes. If you don't file and you're owed a refund however, you may forfeit the refund if you don't file in three years. If, on the other hand, you don't pay your taxes, the IRS will usually send you a bill for the owed amount. And this bill could include significant penalties based on how much you owe and how late you are.
Failing to file is a 25 percent penalty, just by itself. And filing late is another 25 percent. And that's before you get to the interest on your unpaid tax debt, which accumulates at 3 percent for every year you're late, on top of the penalties.
Sufficiently freaked out? Again, don't worry -- you can file for an extension to the April 15 tax day deadline. The IRS entitles taxpayers to a six-month extension to file their income tax returns. But beware -- while your filing date may be extended, the due date for any taxes you owe remains April 15, and the IRS can start charging interest on an owed amount from that date.
Last Year's Tax Deadline (Or the One Before That)
Ok, so what if you blew right through the deadline without filing for an extension. Last year. And what if you haven't filed your taxes for multiple years? Again, if you're owed money, you might be in good shape as long as you file within three years (minus the late filing penalty, perhaps). If, on the other hand, you've owed the IRS back taxes for the past few years, it's also not time to panic. Taxpayers may enter into installment agreements with the IRS that allow monthly payments for a period of time instead of paying the full balance in one lump sum.
We don't recommend procrastinating when it comes to filing your taxes -- while it's never really too late to file your taxes, filing late or failing to file can have serious financial consequences. But, life happens. If you're running late, we do have some helpful tips, one of which is to talk to an experienced local tax attorney for assistance.