For most of us, today May 17 is the tax deadline to file our taxes for 2020. But what if you can’t? First off, remember I said “most of us” so if you’re living overseas, in the military overseas, or you were in a disaster you may have more time. So in that case, call the IRS or use the interactive tax assistant on irs.gov.
But if for you May 17 is the deadline and you don’t know what to do, you should ask yourself this. Are you due a refund? If so, then remember “failure to file” penalty is assessed on any tax not paid by the due date. Therefore, if you don’t owe any tax, then filing late isn’t going to be a problem. The only problem is that you don’t have the refund! Just don’t wait to long. If you have a high income, the IRS may be looking for your return. However, if you wait more than three years from the due date the IRS sends the return to the “statue unit” to see if they can refund it. But who waits that long?
OK, so assume you are going to owe. Then your choices are these. You can file an extension with a Form 4868 that you can mail in or file an electronic one. As long as you mail it by May 17 and you’re not in one of those exceptions like you were in the military overseas at the time, you needed to file for example.
You could also just pay what you owe using IRS Direct Pay, or the Electronic Federal Tax Payment System (EFTPS) or by credit or debit card for the tax deadline 2020. You can find them right on IRS.GOV on the blue bar where you see the word PAY. Direct Pay is free to use and you don’t have to enroll in anything unlike EFTPS, an older system. If you use a debit or credit card you have to go through one of three processors and they charge fees. Just look at that under that “pay” tab.
You don’t have to pay it all if you can’t, just pay part of what you owe and indicate the payment is for an “EXTENSION” for Form 4868. The IRS won’t even bill you until they process all the refund returns first. They have to get those out before a certain amount of time after you file the return or they have to pay interest. Being said, if you owe you have time to send in payments. If you think you will pay it off in less than 180 days, then don’t send a form to request an installment agreement because you will get billed for a user fee. But paying the balance or a part of it for an extension on Form 4868 puts the extension on your account.
The 4868 form is only nine lines long. They want you to estimate what you will owe and pay it with the form or online as I described for tax deadline 2020. But even if you sent it in without a balance indicated, you still will avoid the failure to file a penalty. If you owe you will be charged failure to pay penalties and interest. But that’s assuming you can’t pay. That would happen anyway
If you did owe, remember this little tip for tax deadline 2020. Call the IRS and ask for the penalty to be removed. They can’t do it every year. They look at your record of compliance. They usually waive a failure to file and failure to pay penalties under what’s called “first time abatement.” And remarkably, they can do it again if you were a bad little taxpayer in say three years with no penalties!