The IRS has warned taxpayers who have not yet filed their 2019 tax returns that higher penalties will be imposed if they file after September 14. Taxpayers who submitted an extension of time to file their returns have until October 15 to file and do not face the failure to file penalty if they file by that deadline. However, an extension to file is not an extension to pay, so any taxes the taxpayers owe after the July 15 deadline are subject to the failure to pay penalty and interest.
The IRS reminds taxpayers that Free File is available through October 15 to prepare and e-file a 2019 individual return.
The penalty for not filing a federal tax return by the due date, or extended due date, is generally 5% of the unpaid tax for each month or part of a month that a tax return is late, up to 25% of the unpaid tax. However, if no return has been filed after 60 days, the minimum penalty that can be charged is $435 or 100-percent of the unpaid tax, whichever is less. This year, that important 60-day date occurs after September 14. In addition, interest will also be charged on any tax not paid by the July 15 due date.
Taxpayers who have not been assessed any penalties for the past three years may qualify to have penalties abated. A taxpayer who does not qualify for the first-time penalty relief may still qualify for penalty relief if their failure to file or pay on time was due to reasonable cause and not willful neglect. However, interest cannot be abated.
Qualified taxpayers can choose to pay any taxes over time through an installment agreement. More information for taxpayers who owe taxes, but cannot afford to pay the full amount is available at the “What if I can’t pay my taxes?” page on the IRS website.