The tax deadline has come and gone unless of course, you filed a tax extension. If you missed the tax deadline and didn’t file your taxes or an extension, here are a few steps you can take to get your taxes done.
File as Soon as You Can
If you owe money, you’ll want to file as soon as you can to avoid the failure-to-file penalty and a failure-to-pay penalty. Although you may have a penalty for filing late, your penalty will be smaller than if you don’t file at all. Filing as soon as possible will reduce what you owe in interest. The longer you wait to file, the bigger the interest penalty.
The IRS also received copies of your tax forms like 1099-NEC or W-2 forms, which reflect your income earned for the year. You want to file as soon as possible so they don’t show that you owe more taxes since they don’t know all of the tax deductions and credits you qualify for. TurboTax will check and see if you’re eligible for over 350 tax deductions and credits based on your entries.
You may also have a tax refund waiting. While you won’t receive a tax penalty if you have a refund coming, every year the IRS reports close to $1 billion dollars in unclaimed tax refunds because people don’t think they made enough money to file their taxes. Even if you made under the IRS income threshold for filing ($12,400 single, $24,800 married filing jointly), you should file if you had federal taxes withheld from your wages or you are eligible for tax credits like the Earned Income Tax Credit. If you do not file your taxes and you are entitled to a tax refund, you have to claim your tax refund within three years of the tax return due date.
Usually you also need to file if you received an advanced premium tax credit to help you pay for health insurance in the Health Insurance Marketplace, but due to the challenges Americans faced with fluctuating income in 2020, the American Rescue Plan temporarily waives the requirement for taxpayers to pay back excess advanced premium tax credits on their 2020 taxes
Even though you waited to file your taxes, you can still go online and e-file your taxes conveniently from the comfort of your own home with TurboTax. TurboTax is available for e-file until October 15 when the IRS closes e-file for the 2020 tax year.
If you mail in your tax return, it will take the IRS longer to receive and process your return. E-file with direct deposit is the fastest way to get your tax refund. The IRS states they will issue nine out of 10 tax refunds within 21 days or less from acceptance.
If you mail your return, it can typically take four to six weeks from acceptance to receive your tax refund, but right now mailed tax returns are taking even longer. E-file allows your tax return to be received and processed by the IRS quickly and easily. Plus you will also receive acknowledgement of receipt of your return.
Make Payment Arrangements
Some taxpayers put off filing because they owe money and they don’t know how they’re going to pay. If you put off filing for this reason, there are steps you can take that will be better and less costly for you.
You should file as soon as possible, pay what you can, and then request a payment plan from the IRS. The IRS has several options to help you. You can request a short term payment plan, long term installment agreement, offer in compromise, or temporarily delay collections in some situations. You can set up a short term payment plan if you can pay what you owe within 180 days (up from 120 days under the Taxpayer Relief Initiative). Long term installment agreements allow you to pay what you owe over six years. If your total taxes, penalties, and interest is up to $50,000, you can request an installment agreement online.
By the time you get all the tax deductions and credits you’re eligible for, you may be getting a tax refund.
TurboTax Has You Covered
Don’t worry if you missed the deadline, you can still file with TurboTax. TurboTax has you covered and will ask you simple questions about you and give you the deductions and credits you’re eligible for based on your answers. If you have questions, you can connect live via one-way video to a TurboTax Live tax expert with an average of 12 years to get your tax questions answered from the comfort of your home. TurboTax Live tax experts are available year round in English and Spanish and they can also review, sign, and file your taxes and new this year, you can also fully hand over your taxes to them.