If you are late filing your tax return, there are steps you can take to minimize the penalties you may face.
Here are a few of them:
- File your return as soon as possible. The longer you wait, the more penalties you will have to pay. You will have to pay penalties for late filing of tax returns, penalties for the late payment of taxes, and any interest incurred. If you cannot file your return immediately, you need to apply for an extension of filing.
- Pay any taxes you owe immediately. This will help reduce the interest and penalties you owe. Usually, these taxes have already been paid, and the filing of the return can be late, after applying for an extension. However, if you have not yet paid your taxes, you will be penalized for the late payment.
- If you cannot pay the full amount, contact the IRS to set up a payment plan. This will help you avoid additional penalties. Contacting the IRS and setting up a payment plan shows the IRS that you want to pay, but it will take some time before you have the money to pay. Even if you have refunds from the IRS, the late payment is considered as a separate thing.
- Include a detailed explanation of why your return is late when you file it. This may help the IRS waive some of the penalties you would otherwise have to pay. You need to fill up these reasons when you file for an extension.
Late payment of taxes is different from the late filing of the tax returns. If you have fully paid your taxes, then the only penalty would be for the late filing of tax returns. However, it is best to request for an extension to file your returns. Fill up Form 4868 to file for an extension on the tax returns.
If you take these steps, you can minimize the penalties you face for filing your tax return late. However, it is always best to file on time to avoid any penalties altogether.
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