5 things tax filers should know about getting their taxes in late

Those who do not file or pay their taxes by the deadline should be aware that they should still file their taxes, but that a penalty may apply.

In 2018, the U.S. tax deadline was April 17th. Every year, many filers in Massachusetts meet this deadline, but some do not. While filers may decide not to move forward with filing at all if they missed the deadline, filers should still submit their tax returns as soon as possible. Otherwise, the IRS may submit a substitute return on their behalf.

Those who do not file their taxes for the year and have a substitute return filed for them will receive a Notice of Deficiency CP3219N suggesting a tax assessment. Those who take the default return instead of applying for an extension may not receive all the deductions and exemptions they are entitled to receive.

1. A failure-to-file penalty may apply

Those who do not meet the tax filing deadline may have to pay a failure-to-file penalty. This penalty is usually more than the failure-to-pay penalty.

2. The penalty starts accruing almost immediately

Filers who have to pay the failure-to-file penalty should know that this fee is usually five percent of the taxes they did not pay for every month or partial months that they fail to submit their returns. The day after the tax filing deadline is when this penalty starts accruing, but it cannot go above 25 percent of the unpaid tax amount.

3. Filers may also have to provide a failure-to-pay penalty

In addition to a failure-to-file penalty, those who do not pay their taxes on time may also face a failure-to-pay penalty. Like the failure-to-file penalty, this fee starts accruing the day after the tax deadline and it can amount to ½ of one percent of the unpaid tax amount.

4. Both penalties have a maximum rate

Filers who are required to pay both the failure-to-file penalty and the failure-to-pay penalty should keep in mind that the maximum penalty they can pay for both situations is five percent.

5. Extensions are attainable

Those who do not file or pay their taxes on time may be able to request an extension. Those who pay at least 90 percent of their taxes by the time they ask for an extension may not be subject to the failure-to-pay penalty, but the remaining balance must be submitted by the time the extension due date arrives.

Contact an attorney

Those who file their taxes late in Massachusetts may have questions and concerns about what they should do and about any penalties they may owe. In this situation, those who missed the tax deadline should reach out to an attorney in their area for assistance.