Problems With Filing Tax Returns LateNews
Posted in on February 28, 2019
You are probably aware that there is an option to delay filing a tax return. What you may not know, however, is that if you owe taxes and fail to file and pay on time, you will likely incur interest and be assessed penalties on that late tax payment. In fact, two penalties could apply: one for filing late and one for paying late, and interest accrues on top of these penalties.
It is easy to see that these amounts can add up quickly, which is all the more reason to make sure that you always file your taxes on time and pay as much as you can when you file.
While a Maryland tax attorney is in the best position to advise you on how late filings and payments will impact your particular tax situation, the following provides some basic information on how the IRS treats late filings and late payments.
IRS Penalties for Filing and Paying Late
Penalties for Late Filing
If you file your tax return more than 60 days after the original date or extended due date, the minimum penalty you will be assessed $205 or, if you owe less than $205, 100 percent of the unpaid tax. Otherwise, the penalty can be as much as 5 percent of your unpaid taxes each month up to a maximum of 25 percent.
Penalties for Late Payment
The penalty for late payment is generally 0.5 percent of your unpaid taxes per month, and this can build up to as much as 25 percent of your unpaid taxes.
Penalties for Both
If you file late and pay late, and incur penalties for both, the maximum amount you can be charged for the two penalties is 5 percent per month.
What to Do If You Can’t Pay
You should file a properly completed tax return even if you can’t pay all the taxes due. And you may want to consider alternative ways to pay your taxes, even if it means resorting to using credit cards or getting a loan. At the end of the day, you might be paying less on loan interest than you will be paying in IRS penalties.
You an also contact the IRS and let them know that you are having trouble making your tax payments. It is possible that the agency will work with you by helping you set up an IRS tax payment plan. And if you can show reasonable cause why you couldn’t file or pay your taxes on time, you may even be able to avoid penalties altogether.
Maryland Tax Attorney Kevin Thorn Can Help
If you are behind in filing your IRS tax returns or are having trouble meeting your tax obligations and are not sure how to proceed, you might want to consider consulting with a Maryland tax attorney. Legal counsel will be able to advise you on any strategies that are available to help avoid or reduce paying exorbitant amounts in penalties and interest and can negotiate on your behalf with the IRS.
Call Thorn Legal Group at 240-235-5096 or contact us online to schedule a confidential consultation.Share This Post