Tax Talk: Tick Tock –The Tax Prep Clock
While most everyone should have filed their taxes by now or are getting ready to finish filing Big Rig Tax Relief is here to help any truckers with last minute tax preparation or any back tax problem. Most of the country has until April 18 to file their taxes except Maine and Massachusetts who have until April 19. Obviously, we know the clock is ticking and the Internal Revenue service doesn’t care why you have not or will not make the tax deadline. So what happens if you miss it?
First, understand this important rule: if you are due a refund there is no penalty if you file a late return, but if you are going to owe the IRS money then you have to file by deadline to avoid the penalties. So what are these penalties, and how bad is it?
According to the IRS, two penalties may apply. The first is a failure-to-file penalty for late filing (missing the deadline). The failure-to-file penalty is normally five percent (.05) of the unpaid taxes for each month that a tax return is late.
The second is a failure-to-pay penalty (for paying late). The failure-to-pay penalty is generally one-half percent (0.005) per month of your unpaid taxes that are due. It applies for each month or part of a month your taxes remain unpaid, and starts accruing the day after taxes are due.
I suggest if you are worried that you cannot afford to pay in full, DO NOT let that prevent you from filing your return. Avoid that penalty all together!
What if you still just can’t file by the deadline? Can you file an extension to avoid the late filing penalty?
Yes, but with restrictions. The bottom line is to avoid that penalty at all costs. You can always establish a resolution agreement with the IRS on any balance owed, so why not keep that balance from growing at a rate of 5% every month?
As always, if you need help, we’re here to help file extensions, prepare your tax returns, resolve any tax debt, and look to see if you have any settlement options available. We can easily identify if your situation would fall into this category. Call us today at 1-844-346-3386 or visit www.CommunityTax.com for more information.
About the Author: Nick Charveron, is a licensed tax practitioner & Co-Founder of Big Rig Tax Relief LLC, a Tax Company focused on Tax Debt Resolution Services. Nick was a motor transport operator (88M) while enlisted in the Illinois National Guard, US Army. Email Nick at [email protected]