It’s Not Too Late for Tax Prep
Did you put off your personal tax prep this year? There’s good news for taxpayers who forgot to submit their returns on time this year.
The Treasury Department and the Internal Revenue Service are providing special tax filing and payment relief to individuals and businesses in response to the COVID-19 Outbreak. The filing deadline for tax returns has been extended from April 15 to July 15, 2020.
Every taxpayer knows that normally, they need to begin preparing their taxes well before the April 15th filing deadline. Stalling until the last minute will send you into a state of panic and frenzy. There’s no worse feeling than missing the due date and wondering if Uncle Sam will pay you a personal visit. While the government won’t come knocking on your door just yet, you should file as soon as possible.
Here’s why you shouldn’t lose sleep over filing a late tax return:
The IRS Doesn’t Penalize Every Late Return
Do you receive money back each year? If so, you may be in luck. You won’t face any penalties if the IRS owes you a refund. But the government will continue to hold your money until you finally file your return. But that doesn’t mean you can delay filing indefinitely. You only have three years to claim a refund.
However, if you do owe money to the IRS, you should still prepare your taxes right away. Yes, you’ll face a failure-to-pay penalty, but the sooner you complete your return, the less you’ll owe. Even if you can’t pay your balance all at once, you may be able to arrange a payment plan.
Late Returns Don’t Always Turn into Audits
“Audit” is one of the scariest words in the taxpayer’s dictionary. Thinking about the government finding a tiny mistake in your tax return is terrifying. Even if you file your taxes by the books, there is still a chance the IRS will randomly select your return for an audit. But just because you didn’t start your tax preparation on time doesn’t mean you’ll get that dreaded red letter in the mail.
There is no proof that the IRS audits late returns at a higher frequency. The truth is that the government doesn’t want taxpayers to know their audit selection methods. You shouldn’t let the fear of an audit keep you from filing your taxes after the due date. Honestly, you’re more likely to find yourself in hot water if you don’t file at all.
Special Circumstances Equal a Later Deadline
This year is an exception to the rule. Even if you forgot about your 2019 taxes completely, there is still plenty of time. And no, you won’t have to worry about the IRS penalizing your late returns—even if you owe.
As everyone in the country is aware, this year has been anything but typical. Most people have spent the last couple of months quarantined at home. This sudden shift also made it difficult to keep track of the time, let alone the days of the week. So when April 15 rolled around, many taxpayers didn’t even realize it.
But, the IRS realized they needed to provide a bit of leeway to taxpayers. The COVID-19 crisis left many people unemployed and unable to pay their federal taxes in full. Instead of enforcing the traditional due date, the government went ahead and pushed the 2019 tax filing deadline to July 15, 2020.
Let the Professionals Prepare Your Tax Return
Sometimes life happens, and you put your taxes on the backburner. Missing the filing deadline can happen to anyone—even the most honest taxpayers. If you forgot to prepare your taxes ahead of time, you’re still in luck. Uncle Sam never turns away money, and the IRS will always accept your return. And the sooner you get it in the mail, the better your outcome will be.
Whether you want to finish filing for this year or start preparing for next season, the pros at Incompass Tax, Estate & Business Solutions can help. We have over three decades of experience handling even the most complicated tax scenarios. It’s our mission to make sure you only pay your fair share and not a penny more. Connect with us online to begin your tax prep so that you can remain on the IRS’s good side.