A tax deadline is the last date in which a taxpayer can file a return with the taxing authority. In the United States, all individual taxpayers and corporations must file their annual tax returns by April 15. The tax return will cover the previous calendar year. Most states also mirror the federal date, requiring that a state tax return be filed before April 15 alongside with the federal tax return.
While it is very important to get your tax returns in on time, there are some methods available to extend the time period you have to file your tax return. But be cautious. Tax payments cannot be extended and any late payments can result in fees, fines, or even jail time if the missed payments warrant serious action.
If you are unable to meet the April 15th deadline for filing federal or state income taxes, a 6 month extension is available to most taxpayers. In order to receive this extension, you must file an IRS Tax Form 7004. This form will ask you for your basic tax information and allow you to explain why you cannot file your tax return by the due date. Most extensions of this type are granted, unless the IRS has reason to believe you are fraudulently attempting to avoid taxes.
Other extensions may also be available, if you can meet the requirements. An IRS Form 2350 allows a U.S. citizen who is living outside of the country to extend their tax return if they believe they qualify for special tax treatment.
Corporations also have specific forms that can provide an extension of time for filing a return. An IRS Form 1138 is a common form used by corporations who are expecting a net operating loss carry back. This extension is granted when the carry back cannot be determined before the April 15th deadline.
Missing extensions can lead to serious fines, penalties, and legal consequences. If you fail to file a tax return, file for an extension, and your tax return is late, you will be charged 5% per month that your return is not turned in, up to a total of 25%
If you have failed to timely pay your taxes, you will be charged is .5% of your tax obligation every month. There is no limit, so failure to pay may lead to very large tax penalties if left unpaid.
Interest is also added on top of the above mentioned penalties. The IRS will charge 4% per year for unpaid taxes.
Finally, if taxes are left paid for a significant amount of time, federal courts can charge a taxpayer with tax evasion, which can lead to additional fines, probation, or possibly prison time in the most serious of cases.