Yanuki
Finance / Taxes
Tax Day is fast approaching, and many people are wondering what to do if they can't pay their taxes by the April 15 deadline. Missing the deadline doesn't mean you're doomed, but it's essential to take action to mitigate penalties and inter...
Filing your tax return on time is crucial, even if you can't pay the full amount owed. Filing on time prevents the failure-to-file penalty, which is generally more expensive than the failure-to-pay penalty. If you can't file by the April 15 deadline, request an extension using IRS Free File to get until October 15 to file. However, remember that an extension to file is not an extension to pay. You still need to estimate and pay what you owe by April 15 to avoid penalties and interest.
If you can't afford to pay your entire tax bill by the deadline, contact the IRS to discuss payment options. Options include short-term payment plans (up to 180 days), long-term installment agreements (monthly payments over several years), an offer in compromise (settling the debt for less than you owe if you can prove financial hardship), and currently not collectible (CNC) status (temporary halt to collection efforts if you can't afford any payments).
Yes! Many tax software platforms stay open for late filers. You can e-file your federal tax return until around the extension deadline. But if it’s much later than that, you may need to mail in your return instead of submitting it online.
The IRS may file a substitute return for you using the income it knows about, which likely won’t include deductions or credits. You’ll still owe taxes, plus penalties and interest. And the longer you wait, the more aggressive collection efforts can become.
It’s unlikely. The IRS doesn’t jail people for being unable to pay. Tax fraud or willfully evading taxes is another story. But if you’re simply behind and trying to catch up, the IRS is usually willing to work with you.
Do these tax tips help you? Share this article with others who need to stay ahead of the curve! Do you have any personal finance experiences you'd like to share? Let us know in the comments!
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