OK, your 2014 taxes are late.
The April 15th deadline has come and gone and you have yet to file your 2014 tax return. Take a deep breath. The good thing is you can still e-file your late 2014 taxes online. However, you may be subject to one or more IRS penalties.
What penalties to expect
There are two penalty fees that the IRS has in place that you may be subject to.
Failure-to-file: this equals out to be 5% of your unpaid taxes for each month or part of a month that a tax return is past the April 15 deadline. This fee caps off at 25% of your unpaid tax.
There are two instances when this could apply to you:
- You owe tax and didn’t file your tax return or an extension of the time to file by April 15th, or
- You owe tax and still don’t file your tax return by the October 15th tax extension deadline
Failure-to-pay: this works out to be 0.5% of your unpaid tax per month or part of a month and begins to accrue the day after taxes are due in April. This fee caps also off at 25% of your unpaid tax.
To be liable for this, you must owe tax and:
- not have filed your tax return or extension by April 15th, or
- have filed an extension for your current year tax return by April 15th deadline but paid less than 90% of the tax amount due, or
- have filed an extension for your current year tax return by April 15th but didn’t pay any of the tax amount due