If I filed for an extension, but I'm still not ready to file, what penalty would there be for not filing?

Question

I cannot believe the #'s I am coming up with are correct, and since I am a procrastinator by heart I don't have time to have a professional review my stuff. I assume I'd have to pay a penalty if I truly do owe what the system says I owe but don't pay on time?

Answer 1

My advice is to file the return as is and ammend it later.

The first poster is blowing smoke up your hinney. Here is the real deal.

If you are due a refund there is no penalty.

If you owe and you filed an extension you return is due October 17th, if you file after that there is a failure to file penalty of 4.5% and failure to pay of .5% for a total of 5% for every month you are late. So if you don’t file by Wednesday you will be late. In addition to the penalty you will have to pay interest compounded daily, the current rate is 8% per year.

If you owe and file by Wednesday but owe, you will have to pay the failure to pay penalty and interest. An extension to file is not an extension to pay. IRS expects you to pay in full by the due date of the return.

If you owe pay what you can with the return, even if its only a token payment like $50. this will reduce the total you owe.

You can’t get another extension to file, but if you owe IRS will bill you and then you can call them and get an extension of time to pay. If you can’t pay in 120 days you can probably get an installment agreement. Unless your owing is a 1 time thing make sure that you remedy the problem that caused you to owe with increased withholding or estimated taxes. If you don’t fix your current year you will always owe and pay more than you have to.

Answer 2

An extention is only good for a certain period of time. After that there are penalties that I believe are a percentage of what you owe. When you filed your extension, you should have paid your estimated taxes because there is a fine for not paying on time too. Check out www.irs.gov. And here's a hint for you-you really need to get on it. Once the IRS gets their sights set on you, they never go away. They just keep coming and coming-even if you think you've cleaned it all up.

Answer 3

The failure to file penalty is 5% per month (up to 25%) that the return is late.

If you owe, you will be charged interest back to April 17th up until you pay. An extension is an extension to file, not to pay. Payments were still due by 4/17.

Answer 4

Well....
I assume this is USA taxes.

not filing at all is illegal and is worse than not paying.

I really like the cheap tax programs .. like turbo tax .. or kliplinger's tax cut. they have helped me lots.

You should be aware that you are already picking up late fee penalties. You are late. Those can jump to 25% of what you owe if you don't file. much less if you do file.

I have been through this adventure twice. It was ugly, but surprisingly not too bad.

I always filed.

if you file now. then the IRS really does not get cranky and will work with you and you can easily get an extension to Dec 30 of this year.

Now if you miss that, one can often get an extension to pay out till March or April of next year.

But they will be a little cranky .. but tolerable as long as you keep in contact with them.

Makes sense. They are human too. and business like. They want to collect your money. So you if keep in contact with them respectfully, and make noises about how and when you are going to pay.. and then mostly or completely stick to that, then they will often work with you.

You and the IRS can live with cranky.

But after about a year late in paying, esp if you haven't talked to them then they begin to get mean.

Mean is difficult, you can go to court or jail. Like they forgot about me and I did not notifiy them -- they somehow lost my address. -- I was not hiding but I did not want to stir them up either.. so when I called them up a year late and said I would pay them, I had to get it sent certified mail cause a fedreral marshal almost visited me.

So during the second adventure a few years later I called them and life was better. your millage might vary, but I think it will be ok.

So out past next April watch out. try really hard to get paid up by then or they will force you on to the payment scheme.

Strangely, if you agree to send them some money, or just start paying payments to the IRS.. you AND the IRS are happier than if you sign the form saying you will always be good and never be late again.

good luck

Answer 5

If you owe, then there will be penalties for late filing and for failure to pay on time.