Your Taxes are Due

April 15th is the due date for individual taxpayers to file their tax returns without an extension. Did you file your return or extension on time?

The Internal Revenue Services’ (IRS) Form 4868 is used to apply for an extension to file your federal individual income tax return. To qualify for the extension, you must estimate and report on Form 4868 your estimated tax liability and file Form 4868 either electronically or by mail by the due date of your return.

Failure to file your return or apply for the extension by the due date can result in a late filing penalty equal to 5% of the amount due for each month your return is late (up to 25%). You may be able to convince the IRS to waive this penalty if you have a reasonable explanation for filing late.

Filing the extension does not prevent the IRS from charging you interest on any unpaid taxes owed or from charging a late payment penalty of 1/2 of 1% of any tax not paid by the due date. The late payment penalty is charged for each month the tax is unpaid up to a maximum of 25% unless you can show the IRS a reasonable cause for not paying on time.

If you need assistance dealing with IRS notices or assessment letters for late filing or late payment penalties, contact Flexible Accounting Services of the Triangle.