Have you failed to file your taxes over the last few years? If so, the Internal Revenue Service (IRS) has some good news for you about those delinquent tax returns: penalty relief.
But you have to be proactive about this offer, and the deadline is quickly approaching. Here’s everything you need to know.
IRS Tax Penalty Relief Deadline Coming Soon
In August 2022, the IRS issued Notice 2022-36, which provides tax penalty relief for many late filers. This applies to 2019 and 2020 tax returns. The most notable qualified forms include both Form 1040 and 1120 series, but you can find a complete list here (scroll to Section 3: “Grant of Relief”).
You need to file your return by September 30, 2022.
“This is a great opportunity to clear your record with the IRS,” says money expert Clark Howard. “Get these returns done and save yourself some money.”
Taking advantage of this can save you some serious money: The Failure to File penalty is a percentage of the amount of unpaid taxes. It’s 5% of the unpaid amount for each month the return is late, up to 25% total.
What if You Already Paid the Failure To File Penalty?
If you already paid the penalty, you are eligible for a refund. Even better, you don’t need to take any action to get it.
In a recent news release, the IRS says that “nearly 1.6 million taxpayers will automatically receive more than $1.2 billion in refunds or credits.”
It’s estimated that you’ll see this money by the end of September.
Final Thoughts
Take the time to file your returns by the deadline if you are eligible for this relief. While you will still owe interest on any unpaid taxes, the money out of your pocket will be significantly less than paying the penalty.
If you have any questions about your taxes or any other money concern, call Clark’s free Consumer Action Center at 636-492-5275.
