Haven't Filed Your 2021 Tax Return Yet? Here's What You Need to Know
Missed the boat? You're not alone.
- Taxes were due on April 18 this year.
- Being late with a tax return could trigger a penalty, but not always.
For some people, filing taxes is a complicated process. Those who itemize on their returns, for example, need to gather different documentation to ensure they're claiming the right deductions for things like mortgage interest and medical expenses. And even those who don't itemize still need to make sure they're reporting all of their income.
Because filing a tax return can require a lot of paperwork, it's easy to see how some people might run into the issue of reaching the filing deadline and not being ready to submit their returns. If that happened to you this year and the April 18 tax-filing deadline has come and gone, you may be working yourself up into a bit of a panic.
Perhaps you simply forgot that taxes were due on April 18. These things can happen. Either way, here are a few things you need to know if you didn't manage to file your 2021 tax return by April 18.
Discover: Find the best tax software for your situation here
Save: We researched free tax software and put together a list of the best here
1. It's too late to get a tax extension
Filers who need more time to submit a tax return can usually request a six-month tax extension and have it granted without issue. There's just one problem, though -- to take advantage of that option, you need to request that extension by the tax-filing deadline itself.
If you missed that boat, it means it's too late to buy yourself an extra six months to get your taxes done now. And in that case, if you think you owe the IRS money from 2021, you'll want to get that return in as soon as possible to minimize costly penalties.
2. If you're owed a refund, there's less to worry about
The IRS does not take kindly to late tax returns when it's owed money. But when you're the one who's owed money, there's no penalty for being late with a tax return.
Of course, the longer it takes you to file your taxes, the longer you'll have to wait for your refund to hit your bank account. And if you're struggling with higher living costs like so many people are these days, putting off your taxes will only mean hurting yourself. The IRS, however, will be happy to hang onto your refund for a few extra weeks or months.
3. If you owe taxes, you should hustle to get that return in as quickly as possible
If you owe the IRS money and didn't submit your tax return by April 18, you've already signed yourself up for a nasty penalty -- one you can minimize, however, by submitting your taxes as soon as you can. When you owe money and are late with a tax return, you get penalized to the tune of 5% per month or partial month your return is late, up to a total of 25%.
So, let's say you owe the IRS $1,000 from 2021 and manage to get your tax return in by May 10, 2022. In that case, you're only looking at a 5% penalty, or $50. But if you're two months late with your return, that penalty will double.
You'll also face a separate penalty for not paying your actual tax bill by April 18. The late payment penalty (not to be confused with the late filing penalty) amounts to 0.50% of your tax bill for each month or partial month you're late, up to 25%. You'll notice that the penalty is way smaller than the late filing penalty. But it's one you'll want to avoid, so the sooner you get your taxes in and figure out exactly what you owe the IRS, the better.
Some people are routinely late with their taxes. If you're owed money, that may be less of a big deal. But if you owe the IRS a pile of cash, make every effort to get that return done and submit it as soon as you can.
Alert: highest cash back card we've seen now has 0% intro APR until 2024
If you're using the wrong credit or debit card, it could be costing you serious money. Our experts love this top pick, which features a 0% intro APR until 2024, an insane cash back rate of up to 5%, and all somehow for no annual fee.
In fact, this card is so good that our experts even use it personally. Click here to read our full review for free and apply in just 2 minutes.
Our Research Expert
We're firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers. The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.