Wednesday, April 16, 2014

Missed April 15th Tax dead line ? What is the penalty for missing 1040 deadline ?

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Eight Facts concerning Penalties for Filing and Paying Late April 15 is the tax day deadline for many individuals. 

If you’re due a refund there’s no penalty if you file a late income tax return. however if you owe taxes and you fail to file and pay on time, you’ll usually owe interest and penalties on the taxes you pay late. Here area unit eight facts that you should comprehend these penalties. 

1. If you file late and owe federal taxes, two penalties may apply. the first may be a failure-to-file penalty for late filing. The second may be a failure-to-pay penalty for paying late.

2. The failure-to-file penalty is typically much more than the failure-to-pay penalty. In most cases, it’s ten times a lot of, so if you can’t pay what you owe by the day of the month, you ought to still file your income tax return on time and pay the maximum amount as you'll. you ought to strive alternative options to pay, such as obtaining a loan or paying by mastercard. The office can work with you to assist you resolve your tax debt. most people can came upon a payment arrange with the office using the net Payment Agreement tool on office.gov.

3. The failure-to-file penalty is often 5 p.c of the unpaid taxes for each month or part of a month that a income tax return is late. it'll not exceed 25 p.c of your unpaid taxes.

4. If you file your come quite 60 days when the day of the month or extended day of the month, the minimum penalty for late filing is the smaller of $135 or 100% of the unpaid tax.

5. The failure-to-pay penalty is mostly 0.5 p.c per month of your unpaid taxes. It applies for each month or part of a month your taxes stay unpaid and starts accruing the day when taxes area unit due. It can build up to the maximum amount as 25 p.c of your unpaid taxes.

6. If the 5 p.c failure-to-file penalty and the 0.5 p.c failure-to-pay penalty both apply in any month, the utmost penalty amount charged for that month is 5 p.c.

7. If you requested associate degree extension of time to file your income tax come by the tax day of the month and paid at least 90 p.c of the taxes you owe, you will not face a failure-to-pay penalty. However, you want to pay the remaining balance by the extended day of the month. you may owe interest on any taxes you pay when the Apr 15 day of the month.

8. you may not need to pay a failure-to-file or failure-to-pay penalty if you'll show affordable cause for not filing or paying on time.