Have You FiledYour 2014 Tax Return Yet ? So you have not filed your 2014 tax return? So what is going to happen if you miss the deadline of April 15 (June 15 for expats)? What’s your scenario? Filed a tax return filing extension?If you filed for a tax return filing extension by April 15, (or June 15 for expats), by filing a
Form 4868, then you will be in compliance if you file the full tax return by October 15. Why? Well, the IRS will not send you a bill for penalties for not filing an extension. However, hopefully you do not owe money to the IRS because you will be paying a penalty and interest on the amount you will owe. You could be assessed 0.5%, up to 25%, for the late payment penalty, which will be levied for each month that the tax is not paid. The interest rate for underpayments could be approximately 3.5%. However, if you did file an extension timely but did not file your return by
October 15, the IRS will ignore the extension and assessed the penalty for the failure to file. Didn’t file an extension but getting a refund?If you think you will be receiving a refund, then the IRS will not worry about your return since they are in no hurry to send you your money. However, if you want your money, you must file a tax return but you have up to three years to file before the IRS keeps the refund. You didn’t file an extension? You are going to owe the IRS? Get prepared!So you did not file an extension and will owe the IRS taxes? You will need to get ready for a tax payment from the IRS. The IRS will add several charges on top of the additional taxes you will owe. These will include (1) delinquency penalty, or failure to file; (2) failure to pay penalties; and (3) interest on the total amount. The fees will be assessed beginning April 16, 2015. So what
are the potential damages added to the taxes? The delinquency penalty could be up to 5% up to a maximum rate of 25% per month past the due date. The failure to pay penalty can be at least $135 past the 60-day filing period. In other words, you owe $1 of additional taxes but you will still have to pay the additional $135 penalty. Will the IRS forgive the penalties?In order to obtain an excuse to not pay the penalties, it must be extreme in some cases. The reasons can range from death, serious illness in the immediate family,
postal issues, or dire guidance from an attorney, tax professional, or accountant. The IRS also has a policy known as the “First Time Abatement”, which most taxpayers are unaware. If you have a history of tax compliance, you can qualify. In order to apply, the taxpayer must have no penalties in the past three years, even if it was excused. All tax returns and tax payments must also be current. What can you do today?We can assist you in being tax compliant with the IRS. Send us a note, info@mirtaxes.com, and let us know your current situation. We can get your returns up-to-date and hopefully avoid any additional taxes or at least additional penalties.
Don’t forget that if you have not filed your 2014 taxes the due date is October 15!! Carl Mir US Taxes, Consulting & Expat Financial Services Visit Website: www.MirTaxes.com
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