The filing and payment deadline for most 2020 federal tax returns is here. Taxpayers should file or request an extension of time to file and pay any taxes they owe by the May 17 deadline to avoid penalties and interest.
Here are some tips for taxpayers who owe tax, but who can't immediately pay their tax bill.
Taxpayers should: File their tax return or request an extension of time to file by the May 17 deadline.
People who owe tax and do not file their return on time or request an extension may face a failure-to-file penalty.
Taxpayers should remember that an extension of time to file is not an extension of time to pay.
An extension gives taxpayers until October 15, 2021 to file their 2020 tax return, but taxes owed are still due May 17, 2021.
Pay as much as possible by the May 17 due date.
Whether filing a return or requesting an extension, taxpayers must pay their tax bill in full by the May filing deadline to avoid penalties and interest.
People who do not pay their taxes on time will face a failure-to-pay penalty.
IRS.gov has information for taxpayers who can't afford to pay taxes they owe.
Set up a payment plan as soon as possible.
Taxpayers who owe but cannot pay in full by the deadline don't have to wait for a tax bill to request a payment plan.
They can apply for a payment plan on IRS.gov.
Taxpayers can also submit a payment plan request in writing using Form 9465, Installment Agreement Request.
Some disaster victims, taxpayers living overseas, military service members and eligible support personnel in combat zones have more time beyond the May 17 deadline to file and pay their taxes.
Taxpayers should also check their state filing and payment deadlines, which may be different from the federal May 17 deadline. A list of state tax division websites is available through the Federation of Tax Administrators.
The federal income tax deadline has passed for most individual taxpayers. However, some haven't filed their 2020 tax returns or paid their tax due.
If an individual taxpayer is owed a refund, there's no penalty for filing late. On the other hand, tax owed and not paid by May 17, 2021 is subject to penalties and interest.
Anyone who didn't file and owes tax should file a return as soon as they can and pay as much as they can to reduce penalties and interest. Electronic filing options, including IRS Free File, are still available on IRS.gov through October 15, 2021, to prepare and file returns electronically.
Taxpayers should then review their payment options. The IRS has information for taxpayers who can't pay taxes they owe.
Some taxpayers may have extra time to file their tax returns and pay any taxes due. This includes some disaster victims, taxpayers living overseas, certain military service members and eligible support personnel in combat zones.
Filing soon is very important because the late-filing and late-payment penalties on unpaid taxes add up quickly. However, in some cases, a taxpayer filing after the deadline may qualify for penalty relief. For those charged a penalty, they may contact the IRS by calling the number on their notice and explain why they couldn't file and pay on time.
Taxpayers who have a history of filing and paying on time often qualify for administrative penalty relief. A taxpayer usually qualifies if they have filed and paid timely for the past three years and meet other requirements. For details, taxpayers should visit the first-time penalty abatement page on IRS.gov.
State filing and payment deadlines may be different from the federal deadline. A list of state tax division websites is available through the Federation of Tax Administrators.