What sort of penalties am I look at for filing past the deadline?

knittingfun Member Newcomer
edited October 2023 in After you file

If I can't finish filing by the extension deadline (I already know I owe), I'm wondering how bad it is...

Best Answer

  • rachels
    rachels FreeTaxUSA Agent
    edited October 2023 Answer ✓

    The penalty for filing late is worse than the penalty for paying late. If you can get your return in on time, you will be much better off, even if you can't afford to pay the amount due at that time.

    "The Failure to File Penalty is 5% of the unpaid taxes for each month or part of a month that a tax return is late. The penalty won't exceed 25% of your unpaid taxes...If your return was over 60 days late, the minimum Failure to File Penalty is $450, for tax returns required to be filed in 2023, or 100% of the tax required to be shown on the return, whichever is less."

    Failure to File Penalty | Internal Revenue Service (irs.gov)

    "The Failure to Pay Penalty is 0.5% of the unpaid taxes for each month or part of a month the tax remains unpaid. The penalty won’t exceed 25% of your unpaid taxes."

    Failure to Pay Penalty | Internal Revenue Service (irs.gov)


  • StevenCee
    StevenCee Member Level 2

    My experience has been that if you file a bit late, it's not like you get hit with any massive penalties. I've filed late a number of times, one time, I even estimated what my penalty would be, and got a refund back, as I guess I figured it to be higher than it turned out to be.

    The IRS, as long as they have no reason to believe you're trying to skate, or cheat, is not going to be out to get you. I'd suggest it's better to be a little late, than stress out, and make mistakes, trying to get in by the deadline. The worst aspect of filing past today, is that you can't send your return electronically, but will have to print it out and mail or FedEx it to them...

  • MatthewD
    MatthewD FreeTaxUSA Team


    Thanks for sharing your experience. That is so helpful. Let me add some IRS information as well.

    There are a number of different penalties, the three most common are:

    1. Late Filing Penalty
    2. Late Payment Penalty
    3. Underpayment Penalty.

    For all penalties see the IRS Penalties web page.

    Just about all penalties are assessed on how much you owe the IRS. If you have a refund, there generally is no penalty. One of the stiffest penalties is the failure to file penalty, which can be up to 25% of your unpaid balance and will reach that amount in just 5 months at 5% a month.

    The failure to pay penalty is 0.5% a month up to a maximum of 25% of the unpaid balance, so that one can take a while to get up there. This is what most people deal with.

    The last common penalty is the underpayment of estimated tax penalty. You can get hit with this one even if you pay on time or have a refund! The IRS calculates this one. It is based on not paying enough estimated tax or withholdings throughout the year. See this IRS page for details:

  • StevenCee
    StevenCee Member Level 2

    So basically, if you don't owe very much, you won't get a Willie Nelson level penalty, since even if it's 50% of what you owe, 50% of a small amount will be a small amount. I wish the IRS gets the money it's supposed to, via the bill passed recently, so they can add more highly trained agents, and update their computer systems, so they can put more of their enforcement focus on the major players, who file complex returns, and usually get away with huge, fraudulent tax avoidance schemes. It's easy to go after waiters not declaring tips, etc., but just as they recently slapped Microsoft with a bill for many millions, there are lots of other companies, and individuals, who've been working the system to their own huge advantage. Time for them to pay their fair share... <stepping down off soapbox> ;-)

  • knittingfun
    knittingfun Member Newcomer

    Thanks @StevenCee I hope that happens too, would make it easier for people like me to file.