What Happens If You Don’t File Your Taxes on Time?

Milford, NH Resident Starts to Panic

If you miss the tax deadline and owe money on your taxes, you will likely incur a penalty up to 5% of the amount of taxes you owe for each month that it is late. This penalty will accrue on top of the tax payment that you already owe the IRS. If this extends beyond sixty days, the minimum penalty is $100 or 100% of the tax due, whichever is less. If you file for an extension this must be done prior to the tax deadline. The extension will give you until October 15, 2024 to file your 2023 taxes. Filing the tax extension in time and subsequently filing your taxes before the October deadline will wipe out the incurred penalties.

A Milford resident was beginning to panic about filing her 2023 taxes. With her paperwork in complete disarray, she didn’t see how she could get everything together and file with the IRS before the deadline. For advice, she contacted the tax experts at Merrimack Tax Associates.

Expecting a Refund or Owing on Your Taxes, This Makes a Big Difference

The biggest factor whether a late tax filing will be subjected to penalties is whether you are expecting a refund or if you owe taxes. If you are due a refund, the IRS will gladly hold on to your money and no penalties will be incurred. However, if you owe money to the IRS then you will likely be hit with penalties based on the amount of money owed. These penalties will continue to grow for sixty days, adding on to the amount of taxes that you now owe the IRS.

The Process for Filing a Tax Extension

The best practice if you will not be able to file your tax return before the deadline is to file for a tax extension. This can be done through the IRS Form 4868, filed electronically or by mailing a copy. The extension for 2023 taxes will then give you until October 15, 2024 to file your tax return without incurring penalties on taxes owed.

The Milford resident was pleased to hear that she had options. With the help of the team at Merrimack Tax Associates, she was able to file for an extension and can now rest easy knowing that she has until October to get her paperwork in order.