What to Do If You Missed the Tax Deadline: A Step-by-Step Guide
Filing taxes is an annual ritual for most Americans. Every year, the tax deadline falls on April 15th. (This year it fell on April 18th). However, due to various reasons, some taxpayers may miss the deadline. If you are one of them, don’t worry, you are not alone. There are several options available to you, and in this blog post, I will outline a step-by-step guide on what to do if you missed the tax deadline.
Step 1: File your tax return as soon as possible
The first step is to file your tax return as soon as possible. Even if you missed the deadline, it’s better to file late than not at all. The longer you wait, the more you may be penalized. If you owe taxes, you may have to pay interest and penalties on the unpaid balance. If you are owed a refund, you won’t receive any penalties for filing late, but you run the risk of losing out on your refund if you don’t file within three years of the date the return was due to be filed.
Step 2: Determine if you owe taxes or are owed a refund
Once your return has been prepared, you’ll be able to determine if you owe taxes or are owed a refund. If you owe taxes, you will need to pay the balance as soon as possible to avoid accruing more interest and penalties. Or at least get on a payment plan so that you can make affordable payments. Just be aware that while you’re on the payment plan, interest and penalties will continue to accrue until your balance is paid in full. If you are owed a refund, you won’t receive any penalties for filing late.
Step 3: Request penalty relief if eligible
If you owe taxes and are unable to pay and are issued a penalty – you may be able to request penalty relief. The IRS will sometimes make an exception and waive some of your penalties.
Step 4: Seek Out a Tax Professional
If you’ve missed the tax deadline and forgot to file an extension, working with a tax professional can be the difference between a stressful, last-minute scramble and a smooth, hassle-free experience. While it can be tempting to try to save money by preparing your taxes yourself, the potential risks and pitfalls of doing so far outweigh any potential benefits.
A tax professional has the experience and knowledge to navigate the complex and ever-changing tax laws and regulations, ensuring that your taxes are prepared correctly (even though you’ll be submitting a late-filed tax return). They can also help you identify potential deductions and credits that you might miss on your own, which can save you money and prevent you from overpaying on taxes.
Step 5: Avoid missing future tax deadlines
The best way to avoid missing future tax deadlines is to be proactive. Set reminders for yourself well in advance of the tax deadline and begin gathering all necessary documents and information early. If you are self-employed or have irregular income, consider making estimated tax payments throughout the year to avoid a large tax bill come tax season.
Also, I want to reiterate that if you are owed a refund, you won’t receive any penalties for filing late. In fact, the IRS will hold onto your refund for up to three years after the original deadline. However, after three years, the refund becomes the property of the U.S. Treasury, and you will lose the opportunity to claim it.
Bonus: Create a Profile on IRS.Gov
Setting up an account on the IRS website offers a range of benefits including having easier access to your information such as your balance owed (if any), your tax transcripts, facilitating your payments, automatic account updates like address changes, and more. Click Here to watch my video teaching you how to set up your IRS account.
In conclusion, if you missed the tax deadline, don’t panic. You still have options available to you. The most important thing is to file your tax return as soon as possible, determine if you owe taxes or are owed a refund, pay any taxes owed as soon as possible, contact a tax professional, and avoid missing future tax deadlines. By following these steps, you can minimize any penalties and interest and avoid any future issues with the IRS.
I’m Ktasha (“Tasha”), a seasoned expert in small business management and taxes. My expertise lies in supporting small business owners and self-employed individuals like you with tax management and overall business operations. I understand how challenging it can be to keep everything organized and running smoothly when you’re focusing on running your business. That’s why I’m here to help take the weight off your shoulders. I offer tailored service packages, as well as consultation and coaching services, to help simplify your business affairs and reduce stress. Whether you’re an experienced entrepreneur or new to the game, I’m here to help you navigate the complexities of business ownership and operations with ease.