What Happens if You Don’t File Your Taxes on Time?

Filing a tax return is fairly easy, but that doesn’t make it any less important. There will be consequences if you don’t file your taxes before they are due. What happens if you don’t file your taxes on time? Read below to find the answer so you can plan your taxes accordingly every year.

How Penalties Work

The IRS is very upfront with its penalties so you know precisely why you should file. Let’s summarize what to expect when you’re facing tax penalties. The IRS has the Failure to File Penalty and will inform you directly so you know that you owe this penalty. As you may guess, this happens when you don’t file your taxes. How much any person owes is unique to their situation. The IRS will calculate your penalty based on how much you owe in unpaid taxes and how long it takes you to file your taxes.

Penalty Payment Specifics

The penalty is five percent of your overall unpaid taxes, but that can increase to 25 percent if you continue to avoid filing. This doesn’t include the interest the IRS will impose on you for the penalty.

To put it into perspective, the minimum penalty for 60-day overdue tax filing was $435 for tax returns filed in 2020–2022. However, the IRS may require the minimum penalty to be equal to the tax listed on your return. The IRS will have you pay the lower amount.

Speaking With Professionals

Now, you should have a clearer understanding of what happens if you don’t file your taxes on time. That said, you may have more questions. Reach out to an expert who can work with you directly if you need help organizing and completing taxes accurately to avoid penalties. Our tax firm at Accutax Business Center helps people file their taxes without overlooking valuable savings and accuracy.

We can work with you to prevent penalties from the IRS. Whether you’re in the U.S. or moving abroad as an expat, working with a tax firm is invaluable for anyone who wants to avoid penalties. Talk to an expert today so you can start strategizing the perfect way to organize and complete taxes on time throughout the year.