The 2018 filing deadline for most taxpayers was April 15, 2019. However, many taxpayers needed a little more time and filed for an extension. The extension allowed these individuals a little more time to get their taxes in order. However, that extended deadline is fast approaching and taxpayers who filed for an extension need to get their taxes filed by October 15, 2019.
Not Making a Payment When Filing the Extension
Filing an extension will not excuse a failure to pay taxes. If you owe money on your tax return for 2018, you may be assessed interest or late payment penalties, even if you filed for an extension. An extension extends the filing requirement but not the payment requirement. If you still owe money and have not made plans to pay or file your taxes from last year, the deadline is only a couple of weeks away.
Failure to File by the Extended Deadline
Failure to file a tax return by the deadline can result in separate penalties for late filing and for late payment. Late filing penalties and late payment penalties can be assessed on top of each other. The longer you go without filing and the longer you go without making the payment, the more you will owe.
Some taxpayers know they do not have the full amount to pay off their tax debt and just let the penalties and interest continue to build up. If you cannot make the full payment, it is still better to contact the IRS to address the issue instead of ignoring it. Talk to your Maryland tax lawyer about payment options or ways to negotiate your tax debt.
Do Not Ignore Your Maryland or Federal Tax Filings
Some people try and get by as long as possible without filing tax returns. However, the IRS can still audit your tax return years later. In the event of suspected tax fraud, the IRS can go back as far as they want to assess payment, penalties, fines, and even prosecute for criminal fraud.
If you do not file a tax return, the IRS may file a substitute tax return on your behalf. This will generally be done with the information available to the IRS and may not include available credits or deductions you may be eligible for. A substitute tax return can also assess interest and penalties from the time the payment was due, even if the tax assessment is sent to the taxpayer years later.
Failure to make payments or responding to tax notices may result in enforcement action. The IRS may go through collections to get unpaid taxes, including levying your wages or bank accounts or filing a federal tax lien on your property.
Don't Wait for the IRS to Come Knocking at Your Door
If you've been putting off dealing with tax debts or other tax issues, it is generally better to handle these proactively instead of waiting for the IRS to come to you. There are programs available for voluntary compliance that can reduce the penalties assessed. Additionally, your reliable tax attorney can negotiate with the IRS for a manageable payment plan or offer in compromise to reduce your tax liability and put the tax issues behind you.
Have a Tax Issue to Deal With Before the Extension Deadline?
Your Maryland tax attorney can discuss your tax issues, review any tax notices, and help you handle any tax issues to reduce any tax penalties. Contact Gabaie & Associates, LLC in Maryland for a free consultation on your state or federal tax issue at (410) 862-2198.
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