Income tax deadline on Monday October 17 - An important tip!

[Bruce D. Kowal]

If you are NOT fully prepared to file your 2021 tax return on Monday, October 17, DON'T FILE LATE!!!!!  [IRS calls this "FAILURE TO FILE".  It is not a sexual dysfunction]

What you do is to FILE SOMETHING to the best of your ability, and AMEND the return when you are ready.

You have three years from date of filing to AMEND a tax return.

FILE SOMETHING - best guess.  If you definitely think you will owe tax, well, OVERPAY.  Better to overpay and claim a refund, than to incur the LATE FILING penalty.  

Oh, how much is the LATE FILING penalty?  If you OWE money, it's FIVE PERCENT EACH MONTH to a maximum of 25%.

Or as IRS puts it on its webpage:

The Failure to File Penalty is 5% of the unpaid taxes for each month or part of a month that a tax return is late. The penalty won't exceed 25% of your unpaid taxesT

https://www.irs.gov/payments/f...

And, if you live in a State with income tax, that State will likewise assess a penalty.

So, let's do the math.  If it turns out that you OWE, say, $10,000, well, IRS penalty can be $2,500 and the State, add another $1,000.  Who needs that?  Better to pay a sharp CPA/EA to file something and amend later.

Although, we are very busy as we approach October 17, most CPA's can spare, for a fee, the time to file something reasonable.  Not more than two hours of our time.

Failure to file, or Late Filing is very expensive and completely unnecessary!!!!!!.

Now you know.  And that's why you come to BP.  Right?

Now, I am going back to work . . .

Ah, one last thing.  The same goes for those business returns which were due last month.  Sept 15.  If you have not filed, file SOMETHING NOW before the penalty exceeds one month, and amend later.