Can You File Your Taxes Late if You Don’t Owe?
I’ve received a couple of last minute questions from readers about whether or not you need to file your taxes on time if you don’t owe anything. Interestingly, the answer is “no” — here’s why…
All relevant penalties (for both underpayment and failure to file) are based on the amount owed. In the case of failure to file, it’s typically 5% of your unpaid taxes per month (or portion thereof) after the deadline that they receive your return, topping out at 25%. If you file on time but pay too little, you’ll face a penalty of 0.5%/month of the amount due (plus interest).
So… If the IRS owes you money, there’s actually no need
to file on time. You’ll need to file no later than April 15, 2015 to claim your refund (after that it’s forfeited) but you won’t be penalized for filing late.
This isn’t to say that you should go ahead and file late. After all, that’s your money. You might as well claim it as soon as possible. And don’t forget the possibility that you’re mistaken, and you actually do owe taxes. In that case, you may unwittingly subject yourself to the wrath of the IRS.
If you want to be on the safe side, you should at least request an extension and then sort things out after the deadline.
Published on April 17th, 2012Source: www.fivecentnickel.com