Taxpayers who failed to file return face higher penalty after June 14

Personal Finance

The IRS steps up its late-filing penalty about 60 days after the April filing deadline. Thus, the June 14 cutoff. Beyond then, penalty is at least $210 unless you happen to owe less than that.

Even if you can’t pay what you owe, submitting your return by June 14 will avoid that higher late-filing penalty, which stops accruing once you send in your return.

Keep in mind that the charge for filing late is separate from the one for paying late. Even when taxpayers file on time, not paying what is owed typically results in a penalty of 0.5 percent of the unpaid tax for each month it’s late.

So if you file your return now without the full amount owed, you will continue accruing a late-payment penalty.

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On top of that is interest, which currently stands at an annualized rate of 5 percent. This applies to the balance of your unpaid tax bill.

Another reason to file your return even if you can’t pay is this: The IRS might be more lenient with you.

“If you run into trouble paying down the road, you’ve demonstrated an effort to comply,” Jones said.

The agency allows taxpayers to apply for a payment plan. While these are subject to approval and comes with a fee that could range from zero to $149, they give you time to come up with the amount due.

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