THOSE who requested an extension to file their 2021 tax return only have one day left as the deadline is Monday, October 17.
The extension deadline is usually October 15, but this year the date falls on a Saturday.
This means it has been moved to the next business day.
If returns are not filed by tomorrow, taxpayers could face late filing penalties.
The penalty is called the Failure to File Penalty and it is calculated based on how late you file your tax return plus the amount of unpaid tax by the original payment due date – not the date extension deadline.
Unpaid tax is the total tax that must be reported on your return minus amounts paid by withholding tax, estimated tax payments, and allowable refundable credits, according to the IRS website.
The penalty for failing to file is five percent of unpaid taxes for each month or part of a month that a tax return is late.
However, the penalty does not exceed 25% of your unpaid taxes.
Steps to file with the IRS
Although there are many companies and websites to file your return, the IRS has a tool called IRS Free File, which is available to anyone with an Adjusted Gross Income (AGI) of $73,000 or less in 2021.
Taxpayers can use the IRS Free File to claim credits like Child Tax Credit, Earned Income Tax Credit and others.
To use the tool, create an online account as this will help you file an accurate return.
Taxpayers can also get answers to tax law questions using the IRS’ Interactive Tax Assistant tool.
Taxpayers with additional filing deadline
There are specific cases where the IRS has given taxpayers additional time to file after the October 17 deadline.
This includes military personnel and others serving in a combat zone.
These taxpayers will have 180 days after leaving the combat zone to file returns and pay any taxes due.
Additionally, those suffering and recovering from recent national disasters have until November 15, 2022.
The areas include parts of:
- St. Croix Island in the US Virgin Islands
- Members of the Salt River Pima Maricopa Indian Community Tribal Nation
In addition, taxpayers in the following states have until February 15, 2023 to file:
- Porto Rico
- North Carolina
- Caroline from the south
- Parts of Alaska and Hinds County
If you’ve been affected by recent storms, visit the Disaster Relief page on IRS.gov for the latest information.
The Sun reveals how millions of Americans stand to benefit from tax relief of up to $1,000 – are you eligible?
Plus, a tax expert shares steps to take before the end of 2022, including preparing direct payments worth up to $1,000.