What Happens If You File Taxes Late?

Jenny Handwerk |

What Happens If You File Taxes Late?

Tax Day falls on April 15 every year at approximately the same time. Even if you are aware of the tax filing date, it can be difficult to prepare everything for your individual income tax return in time.

A woman who failed to meet the deadline for a tax extension
This is where extensions come in, providing additional time to organize your income tax documentation. It can be difficult to know all the details about extensions. 

If you file your federal tax return after the deadline (April 15 for most people), you may be subject to IRS fines. However, you should still finish your Form 1040 and pay your taxes as soon as possible if you owe the IRS money, even if you don't complete your 2023 federal tax return or request for an extension by April 15.

Additionally, if you cannot file your federal income tax return, make a payment as soon as possible. If you miss the tax deadline, you can prevent the accumulation of fines and interest by moving fast to file your taxes.

Penalties for Missing a Tax Deadline 

Generally speaking, the IRS may impose a failure-to-file penalty if you miss the April filing deadline or neglect to submit by the tax extension deadline. The penalty is computed on the amount of overdue taxes. For each month, whether whole or partial, that you delay paying your taxes, the IRS deducts 5%. However, the maximum amount the IRS can impose on you is limited to 25% of the taxes that are due.

Let's take the scenario where you owe $10,000 in taxes. The IRS will assess a $500 fee each month that your taxes are not filed, but the maximum amount the IRS may charge you is $2,500.

If you anticipate having to pay fines for filing your tax return after the deadline, you should consult a tax expert. You may also be liable for interest and other penalties.

Will the IRS notice if you file late?

You might be concerned about whether the IRS will even notice that your tax return is one day late given that they get millions of them at the last minute.  

Why take the chance is the actual query you should ask yourself. Furthermore, the IRS may view the postmarked date on the envelope if you mail it in your return, so if you're a few days beyond due, you could receive a bill for a tiny amount.  

If you fail to file by the deadline, the IRS can file on your behalf if it has access to your W2. We refer to this as a "substitute return." If this happens, you will get a Notice of Deficiency from the IRS suggesting a tax assessment using your W2s. Even though it could seem appealing to refrain from performing the work, filing on behalf of the IRS might prevent you from benefiting from any deductions and exemptions that apply to you. Thus, it is ideal to avoid having to deal with this.  

Other consequences for not paying taxes

The State Department may eventually refuse to issue or renew your passport if you haven't paid your outstanding balance. Your passport may even be cancelled if you have a "seriously tax debt," defined as $62,000 or more.

Ten years are allowed by the IRS to pursue unpaid taxes. You will not go to prison for not having enough money to pay your tax bill, even if tax evasion and tax fraud are crimes that carry jail sentences. For this reason, even if you don't include your entire amount, submitting a return is still crucial.

Can I get more time after the October deadline?

Regretfully, the deadline for tax filing extensions cannot be extended past October 15, 2024. This indicates that this is your final opportunity to file a tax return without incurring interest or penalties if you still need to file for the 2023 tax year.

Furthermore, even though there isn't a tax payment extension, you have options if you can't afford your tax bill. If you want to pay your taxes over time, you can apply for an IRS payment plan.

You Still Can File Your Taxes  After the Deadline

Most taxpayers can still file their taxes for free even if they miss the deadline. With the IRS's Free File Program, taxpayers can file for free if their adjusted gross income is $79,000 or less.

The Free File Program guides taxpayers through a step-by-step process through a series of straightforward inquiries. You can select from a variety of tax software providers to file. Additionally, although submitting most federal forms is free, filing state tax returns may incur an additional cost.

The IRS program is typically accessible through the middle of October every year.