When it comes to filing your tax return, it is essential to understand when the tax season ends. This year, the tax deadline has been moved from April 15th to May 17th, 2021, giving taxpayers an extra month to file their taxes. However, if you miss this deadline, you might face penalties and interest charges. In this article, we will explore when the tax season ends and what happens if you file late.
When Does Tax Season End?
The tax season typically starts in late January and runs until April 15th. However, this year, the Internal Revenue Service (IRS) has extended the deadline to May 17th, 2021, giving taxpayers an additional month to file their taxes. This extension applies to federal tax returns and tax payments for individuals, including self-employed individuals, and any tax payments due for the tax year 2020. The extension does not apply to state tax returns or other tax deadlines.
It is worth noting that taxpayers who need additional time to file their taxes may request an extension. Filing an extension gives you an additional six months to file your tax return, but it does not extend the time to pay any taxes owed. It is crucial to estimate how much you owe and pay the amount by May 17th, 2021, to avoid penalties and interest charges.
What Happens if You Miss the Deadline?
If you miss the tax deadline and did not file for an extension, you may face penalties and interest charges. The IRS charges a penalty for filing your tax return late, which is 5% of the unpaid taxes for each month that your return is late, up to a maximum of 25%. The penalty is based on how much you owe, so the more you owe, the higher the penalty.
Additionally, the IRS charges a penalty for paying your taxes late, which is 0.5% of the unpaid taxes for each month that the payment is late, up to a maximum of 25%. The penalty is based on how much you owe, so the more you owe, the higher the penalty.
If you owe taxes and do not pay them, even if you file an extension, you will still be subject to interest charges. The interest rate is currently 3% per year, compounded daily, and it accrues from the original due date of your tax return until the date you pay in full.
It is worth noting that the IRS may waive penalties and interest charges in certain circumstances, such as if you can demonstrate reasonable cause or significant hardship. However, these waivers are not automatic, and you need to provide evidence to support your case.
What Should You Do if You Miss the Deadline?
If you miss the tax deadline, the best course of action is to file your tax return as soon as possible. Even if you cannot pay your taxes in full, you should still file your tax return to avoid the late-filing penalty. You can then explore options to pay your taxes, such as setting up a payment plan with the IRS.
It is also important to keep in mind that if you miss the deadline and owe taxes, the longer you wait to pay, the more penalties and interest charges will accrue. Therefore, it is in your best interest to pay what you can as soon as possible and make arrangements to pay the rest as soon as possible.
Conclusion
Understanding when the tax season ends is crucial for filing your tax return on time and avoiding penalties and interest charges. This year, the tax deadline has been extended to May 17th, 2021, giving taxpayers an additional month to file their taxes. However, if you miss the deadline, you may face penalties and interest charges. It is essential to file your tax return as soon as possible and explore options to pay your taxes if you cannot pay them in full. If you have any questions or concerns, it is advisable to consult a tax professional.
