What Happens if You File Taxes Late? Here is the Good News and Bad
The reality is, filing taxes late can have serious consequences, and what happens if you file taxes late largely depends on whether or not you owe the IRS money—or you’re even required to file (more on that later).
What is a Tax Return?
A tax return is an annual federal financial report that assembles and reports tax payments, tax deductions, credits, and income received for money earned during the prior calendar year (or tax year).
Do I Need to File a Return?
– Your Age – Filing Statu – Gross Income
The IRS may not require you to file an individual tax return (Form 1040), depending on three specific criteria you must meet (usually):
What Happens If You Don’t File Taxes?
First things first. You’re going to get hit with penalties and interest.
Penalties and Interest
The IRS Files a Substitute Return for You
A substitute return won’t include all the details you’d like shown about your tax picture, costing you money for not claiming applicable deductions, credits, or other tax items which benefit your bottom line.
The IRS Will Begin the Collections Process
This one is a baddy. The IRS will come after you for money they think you owe them.
What Should I Do If I Can’t Pay My Tax Bill?
People who are in a position to pay their taxes should make payments as they go. That means that you are showing people that you are acting in good faith to pay what you owe, and this will also lower the amount of money you would have to pay (that’s how paying bills works!).
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