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How Much Could Late Tax Filing Cost You in 2024? Don’t Find Out the Hard Way!

Updated: Apr 18

As April 15 approaches, many taxpayers are feeling the crunch. This year’s tax season brings both familiar deadlines and a few twists that could impact when and how you file your federal tax returns. Here’s what you need to know to navigate the 2023 tax season confidently.

Table of Contents

  • Understanding Key Deadlines

  • Last-Minute Filing Strategies

  • Payment Options and Penalties

  • Refunds and Why You Should File Early?

  • Navigating Tax Season with Confidence

Understanding Key Deadlines

April 15: Traditionally, April 15 is the deadline for filing federal tax returns and making tax payments. However, if this date falls on a weekend or a holiday, the deadline is pushed to the next business day. This year, the federal tax deadline remains on April 15 for most taxpayers.

Extended Deadlines for Specific States: Taxpayers in Massachusetts and Maine have a unique extension until April 17 due to Patriots' Day and Emancipation Day holidays in those states. This gives residents a couple more days to file and settle their dues without penalties.

Special Extensions for Affected Taxpayers: Certain circumstances such as natural disasters or other significant events like the October 7 attack on Israel provide affected individuals and businesses with extended deadlines. The IRS typically announces these extensions through official statements, so it's crucial to stay updated via IRS announcements or consult a tax professional if you believe you qualify for such extensions.

Last-Minute Filing Strategies

Filing Online: Electronic filing (e-filing) is the fastest and safest way to file your tax returns. It reduces errors, provides confirmation upon receipt, and expedites your refund processing. The IRS provides several e-filing options, including IRS Free File for those with an adjusted gross income of $79,000 or less, and the new Direct File pilot program for eligible taxpayers in 12 states.

Seeking Extensions: If you're unable to file by April 15, you can request an automatic six-month extension by filing Form 4868. This extends your filing deadline to October 15. Remember, this is an extension to file, not an extension to pay. If you owe taxes, you’re expected to estimate and pay the amount by April 15 to avoid interest and penalties.

Utilizing Tax Preparation Software: Many taxpayers qualify for free or reduced-cost assistance through IRS partnerships with several tax preparation software providers. These platforms guide you through the filing process, help optimize your tax deductions, and ensure compliance with the latest tax laws.

Payment Options and Penalties

Payment Methods: The IRS offers various payment methods, including IRS Direct Pay, electronic funds transfer, and payments by credit or debit cards. Making a payment and indicating it’s for an extension can automatically count as requesting an extension, simplifying the process.

Understanding Penalties: Missing the April 15 deadline without filing for an extension can lead to hefty penalties. The failure-to-file penalty is significantly higher than the failure-to-pay penalty, which is why filing for an extension can mitigate larger fees. The IRS charges 5% of unpaid taxes per month for failing to file, capped at 25% of the unpaid taxes. Conversely, the failure-to-pay penalty is 0.5% per month, also capped at 25%.

Refunds and Why You Should File Early?

Expecting a Refund? : Two-thirds of filers typically receive tax refunds. If you expect a refund, filing early is beneficial. Not only do you receive your refund sooner, but filing early also reduces the risk of identity theft. As of early April, the IRS reported that the average refund was $3,011, up 4.6% from the previous year.

Direct Deposit: Opting for direct deposit is the quickest way to receive your refund. According to the IRS, taxpayers who use direct deposit and file electronically can expect their refund within 21 days of their return being accepted.

Navigating Tax Season with Confidence

This tax season, take full advantage of the resources and tools provided by the IRS. Whether you are filing online with Free File or Direct File, paying your taxes electronically, or requesting an extension, understanding your options can make the process smoother and less stressful.

Stay proactive by keeping track of deadlines, organizing your documents early, and exploring all avenues for deductions and credits. With the right preparation, you can tackle this tax season with ease and precision, ensuring you meet your obligations and possibly enjoy a timely refund.

Frequently Asked Questions

Q1. Is April 15 the last day to file taxes?

To avoid penalties and late fees, taxpayers who owe should pay either their full tax bill or at least what they can afford to pay by the April 15 deadline," the IRS said. There's also a fine if you don't file or ask for an extension by April 15.

Q2. What happens if you file taxes after April 18?

If you file your taxes after April 18 without an extension, you may face several consequences:

Late Filing Penalties: Generally, 5% of unpaid taxes per month, capped at 25%.

Late Payment Penalties: About 0.5% per month of unpaid taxes, up to 25%.

Interest: Accrues on unpaid taxes from the due date until payment.

Delayed Refunds: No penalty for late filing if expecting a refund, but delays are likely.

Impact on Loans: Late filing can complicate loan approvals as lenders often require recent tax returns.

To avoid these issues, consider filing an extension by the due date, allowing until October 15 to submit your return. Note that this extension does not apply to any taxes owed.


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