Failure to file your taxes often results in a myriad of unpleasant consequences. Late taxes leave you open to financial penalties, and the IRS also audits taxpayers who fail to file. If you have yet to submit your paperwork this year, find out how to rectify your fiscal situation.
File for a tax extension. While filing taxes late is never ideal, an extension relieves the immediate pressure of submitting your documentation. Keep in mind that an extension informs the IRS of your intention to file late taxes, but it does not alleviate your financial obligation. An extension does, however, provide you with a lower penalty rate. Fortunately, every taxpayer is eligible for a six-month extension on the filing deadline.
After notifying the IRS, you need to prepare your tax return and gather all of the supporting documents. In many instances, taxpayers find themselves with late taxes simply because they are missing essential files. If you cannot find your W-2 form or you are missing a 1099, contact your employer or contractor for a replacement copy as quickly as possible. Generally speaking, these are the only documents you need to complete your paperwork.
Difficulty or confusion regarding the filing process also contributes to the tardiness of many tax returns. If you feel overwhelmed by your late taxes, consider consulting with a tax professional. Experienced tax preparers understand the intricacies of tax law, and many offer service guarantees in the event of an audit. In some cases, these preparers also offer deferred payment options if you are unable to pay for your tax assistance immediately. As a cheaper alternative, consider third-party tax software that fills out your forms based on the information you provide. Not only are these effective solutions for filing taxes late, but many software programs allow you to submit your returns electronically.
While fiscal responsibility is essential, the IRS understands that certain challenges divert your focus from time to time. If you have late taxes due to extenuating circumstances, the IRS provides guidelines for penalty forgiveness. Consult all available documentation when you submit your return to ensure that you do not miss the opportunity to recoup any interest charges from the government.
Although it is never a good idea to intentionally delay your tax return, there is no penalty if you are eligible for a refund from the government. Assuming you have no tax liability, the federal government deducts nothing from your refund. Nevertheless, you need to avoid late taxes file as soon as possible, as your refund becomes the property of the U.S. government if you wait too long to claim it.
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