Federal Tax Day Is April 15
Avoid IRS Tax Penalties and Late Fees
To avoid having to pay fines and late fees, citizens are encouraged to complete electronic or hard copy filings by the deadline even if they are unable to pay their taxes on time. As noted at their website, the Internal Revenue Service (IRS) is aware that due to unexpected changes in a person’s economic situation including a job loss or medical situation, it may be a challenge to pay taxes on April 15.
Work with the Internal Revenue Service (IRS) to Pay Income Taxes
People who are unable to complete their federal income tax forms and pay all of their taxes should contact their local Internal Revenue Service office and set up a payment plan. In troubling times it can be tempting to let the date pass. However, one can avoid a lot of struggle and worry by reaching out to their local revenue and taxation office and letting agents know what they can and cannot pay now. Keep in mind that having a record on file with the Internal Revenue Service that clearly shows that one made every effort to pay their taxes in full as soon as possible is much more helpful than having a record that shows one made no attempt whatsoever to contact their local tax office to make payment arrangements.
Taxpayers who pay late they will likely incur a failure-to-file penalty and interest. Note that interest for late payments are made on all unpaid balances. The longer one delays paying their taxes, the more interest they can incur. To avoid these failure-to-file penalties, at the minimum one should file and request an extension. However, if one is given an extension to file, that does not mean that one has been given additional time to pay their taxes.
Secure an Installment Agreement to Pay Income Taxes
Citizens who are unable to pay their taxes in full by April 15 should contact their local Internal Revenue office and ask to set up an installment agreement. Installment agreements give taxpayers the ability to submit monthly installments until they pay all due taxes. Taxpayers who owe $25,000 or less can complete an online installment agreement application to set up a payment plan. They can also attach an Installment Agreement Request, otherwise known as Form 9465, to their tax return to ask to set up a monthly payment plan.
Persons wishing to request an installment plan should keep in mind that the Internal Revenue Service charges a one-time fee of $105 to set up the plan but only $52 if monthly payments are set up to automatically come out of the taxpayer’s bank account. People with low-incomes may be eligible for a less expensive one-time set up fee of $43.
Taxes and Active Duty Military Members Who Are At Work
People who are serving active duty in the military in a combat zone, or in support, are qualified to wait until after April 15 to pay taxes. There are no penalties or interest charged for the late filing and late payments for eligible military personnel. Typically, taxes do not have to be filed or paid until 180 after military persons exit the battle zone. Military service members who are serving in combat zones are encouraged to check with their service leader to see if they are eligible for the late filing and late payment.
Keep in mind that April 15 is the date that United States citizens must file their annual taxes. Taxpayers who file and pay late may incur penalties interest. Taxpayers who do not file at all may incur failure-to-file penalties in addition to increased interest fees on unpaid tax balances. For those who are concerned that they may not be able to pay some or all of their taxes by April 15, they should file by the deadline and work out a monthly installment payment plan with the Internal Revenue Service. Taxpayers can also work with an income tax preparation service or use income tax preparation software to file for an extension and complete and submit their federal income tax return forms.
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