What Happens if You File a Tax Return Late?

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The quick answer? It depends on whether you owe money or not. 

Taxes are due this year on April 18. Normally, they’re due by April 15, but when that day falls on a weekend, the filing deadline is pushed to the next business day. Only this year, April 17 is Emancipation Day, a Washington, D.C. holiday, so tax filers get until April 18 to get their returns over to the IRS.

Now, you may be aware of this year’s tax-filing deadline, but you might still miss it regardless. And you may be wondering what happens if your tax return arrives late.

The answer is that you might lose out financially in any scenario. But the extent of that financial hit will hinge on whether you owe the IRS money from 2022 or whether you’re due a tax refund.

When you’re owed money from the IRS

The IRS can’t process your refund until it receives your tax return. So if you’re late in filing yours, you’ll have to wait that much longer for your refund to hit your bank account.

That, however, is the only real penalty you’ll face in that situation, if you even want to call it a penalty. The IRS isn’t going to penalize you further for being late with your tax return because it gets to keep your money for longer. So it benefits, and you don’t.

When you owe the IRS money

When you owe the IRS money and are late with a tax return, that’s when you’ll be assessed actual penalties. The way the IRS sees it, you underpaid your taxes in 2022, and now the agency wants its money as soon as possible. And it also wants to see how much you owe as soon as possible, which is why it needs your tax return.

If you’re late with your filing in this scenario, the penalty can be pretty steep. That’s because you’ll be charged 5% of your unpaid tax bill for each month or partial month your tax return is late, up to 25%.

So let’s say you owe the IRS $1,000 from 2022 and are a month late filing your return. That means you’ll be penalized $50.

Get an extension if you need more time to file

If you’re running into the April 18 tax-filing deadline and don’t have your return ready, it’s really important to file an extension. That will extend your personal filing deadline by six months.

One thing an extension will not do is give you more time to pay your tax bill. If you don’t pay yours in full by April 18, you’ll accrue interest and penalties on the sum you owe. But because you’ll get extra time to file, you won’t be penalized separately for being late as long as your return is in by October 16.

If you’re not sure whether you owe the IRS money from 2022 or are owed money, just file that extension so you don’t end up taking chances. You don’t have to come up with a creative excuse for needing more time. All you need to do is submit Form 4868 by April 18, and that extension will happen automatically. It really is that simple.

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