Did You Miss the April 18 Filing Deadline?

May 13, 2023

If you missed the April 18 tax-filing deadline, it’s not too late to file! If you owe taxes and missed the deadline without requesting an extension, the sooner you file the better. This can prevent the accrual of penalties and interest.

Don’t panic; if you are entitled to a tax refund this year and have missed the filing deadline, the IRS will not impose a penalty for late filing. But, it is important not to neglect filing a tax return, as you may be forfeiting a potential refund. Surprisingly, more than one million taxpayers do not claim their tax refunds each year.

 

Usually, the deadline to claim refunds is three years from the original tax deadline, but for 2019 personal tax returns, people have more time than usual to file to claim their refunds. The three-year window for 2019 unfiled returns was postponed to July 17, 2023, due to the COVID-19 pandemic. The IRS estimates almost $1.5 billion in refunds remain unclaimed because people haven't filed their 2019 tax returns yet. Don’t delay; time is running out! 

 

Payment Options

If you find yourself in a situation where you owe taxes but can't afford to pay it all at once, there are different options available to you. 

• Set up an Installment Agreement. One option is to set up an installment agreement with the IRS, which allows you to pay your tax debt in monthly installments over time. This can be a good option if you need more time to pay off your tax debt, but keep in mind that interest and penalties will continue to accrue until your tax debt is paid in full.
• Make a Deal with the IRS. Another option is an offer in compromise, which is an agreement between you and the IRS that settles your tax debt for less than the full amount you owe. This option can be useful if you're unable to pay your full tax debt and don't have enough assets or income to make payments under an installment agreement.
• Temporary Financial Harship Status. If you're facing financial hardship, you may be eligible for a Currently Not Collectible status, which temporarily suspends collection efforts by the IRS. This can be a good option if you're unable to pay your tax debt due to financial hardship, such as a job loss or medical expenses. Interest and penalties will continue to accrue until your tax debt is paid in full.

 

Keep in mind that not everyone will qualify for these options, and there may be other factors to consider when deciding which option is best for you. Working with a tax professional can help you understand your options and navigate the process of resolving your tax debt.

Penalty Abatement

Penalty abatement is when the IRS forgives some or all of the penalties that you owe for failing to file a tax return or pay your taxes on time. There are several circumstances in which the IRS may grant penalty abatement, such as if you experienced a serious illness or death in the family that prevented you from meeting your tax obligations. Penalty abatement is not guaranteed, and you'll need to provide evidence to support your request.

 

Get Help

If you haven't filed your tax returns for several years, it might be beneficial to seek assistance from a tax professional. They can guide you through the complex tax regulations and make sure that you file your taxes correctly. Additionally, they can aid you in arranging a payment schedule and reducing any penalties if you owe back taxes. Seeking help from a tax professional can get you back on the right path with your taxes and prevent future issues with the IRS. If you're dealing with overdue tax returns, don't hesitate to reach out to us for assistance.

Sources: Image by Elisa Ventur