Did you file your taxes? Something came up. You got busy. Or you’re just human. One way or another, you missed the tax deadline. (again?) The first thing to do is forgive yourself. We all make mistakes. The second thing to do is to file your taxes! There are many reasons to not wait any longer. First of all, a refund may be waiting which may have come from tax credits or withholdings. Of course, missing the deadline may not cause as much hassle in terms of penalties if you are actually expecting a refund. But there is still no reason to wait especially since if you wait too long you could lose the refund. However if you back taxes as a result of the late filing, you will want to avoid additional penalties and interest. The later you wait, the more the tax debt.
Seeking out an extension may be necessary as an extra 6 months is always helpful when you are running behind. But remember: whatever complexities or difficulties with your personal or tax situation that caused you to put off filing your taxes—or made it difficult to do so before, are not going away on October 15th. You may run into the same brick wall of anxiety and confusion with the new deadline.
Whether or not you have money waiting for you, the one thing you don’t want waiting for you is accumulated penalties and interest. Remember that it is cheaper to pay late than to file late. The penalty for missing the filing deadline and paying late is 5% of what you owe. If you’re more than 60 days late, the penalty will be even higher. If you pay late but still file on time then the penalty is only .05%. Even if you can’t send an immediate payment, it is still worthwhile to file. Whether you’re waiting for more money to arrive or you have it already, there is never a good reason to wait to do the necessary paperwork. As a rule, the failure to pay penalty is significantly less burdensome than the penalty for filing late.
It’s important to ask yourself: why you are late? The fact is that whether you were just too busy, your tax situation was overly complicated, or you felt you had owed too much money and need some relief, these are all reasons to seek out and work with a reputable firm of tax preparation experts like Business and Financial Solutions.
When you have back taxes that you need to pay and you’re lacking the funds, it may be time to consider some other options besides just letting penalties accrue. Tax payment plans can be great ways to get the debt you owe the government under control. For some individuals, a Offer in Compromise is an excellent way to tackle your back taxes all at once.
Whether you think you owe money, or you just don’t want to be late anymore, let us help reduce your stress so you have one less thing to worry about. Taxes are complicated and the relevant laws and rules change often. We serve clients from across the country and have offices in Frederick MD, Rockville MD, and Vienna VA. Call us now at 855-557-2222 and learn what your options are. We’re here to help you find the tax solution that’s best for you.