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What happens when a tax return is late?

On Behalf of | Dec 4, 2022 | Tax |

In a typical year, Texas residents must file their personal income tax returns by April 15. The consequences for failing to comply with the deadline depend on whether you are owed a refund or owe the government money. However, there may be benefits to filing your tax return as quickly as possible regardless of your circumstances.

Potential consequences of not filing a timely return

The IRS will not send you a refund unless you file a return for the year in which you may be entitled to one. If you are self-employed, failing to file a return may make it harder to claim federal benefits after you retire. In the event that you owe money, you could be hit with a late payment penalty as well as a penalty for failing to file.

What to do if you can’t file on time

If you don’t think that you can file on time, you should request an automatic extension of time to file. This gives you six additional months to do so without penalty. However, it does not give you more time to pay an outstanding balance. You have the option to pay some or all of the balance owed when requesting an extension of time to file. The IRS will likely create a payment plan if you can’t pay what you owe by the time your return is due. Interest will likely continue to accrue until the taxes are paid in full.

Failing to file a tax return may result in both civil and criminal penalties. As a general rule, it is in your best interest to submit tax documents as soon as possible to minimize the impact they may have on your life.