April 17th is the deadline for filing your 2016 taxes this year. More than a million people missed the deadline for filing their 2015 taxes. If you have worries about getting it done, you may want to pay attention to Melody Hahm from Yahoo Finance.
- If you know ahead of time that you’re not going to make the deadline, the first thing you should do is file for an extension with the IRS and your state before the deadline. Once you do that, you’ll get an additional 6 months to file.
- Different states have different requirements for extensions, so be sure to check your state’s rules. Several states don’t even have an income tax, so if you live in one of those, all you’ve got to do is take care of the federal extension.
- If you don’t file your taxes or for an extension, you’ll be subject to a failure to file penalty of 5% of what you owe each month until you pay off the debt. Even if you can’t pay your taxes, file anyway. The federal penalty for not filing anything is 10 times higher than the penalty for not paying.
- If you don't pay, the IRS can file something called a tax lien that can attach to all of your assets (like a home or a car). A lien can also limit your ability to get credit and doesn’t go away if you declare bankruptcy.
- There is no penalty for filing late if you’re getting money back. After all, you’re just letting the government hold onto your money longer But don’t wait too long.
- You can always call the IRS directly. Which sounds crazy, but I've done it..and they actually helped answer some of my questions!
You have four years to file taxes if you’re due a refund. For quick and simple financial advice check out Yahoo Finance’s new column “Two Minute Money.”