Basics of IRS Penalties

IRS Penalties and interest may be for a number of different occurrences. Some examples are: understating your tax liability, understating a reportable transaction, file an erroneous claim for a refund or credit, or file a frivolous tax submission. But the easiest way to receive a penalty is by filing late.  

When it comes to penalties and interest, the Internal Revenue Code may impose many different types of penalties. These can be as simple as a civil fine, or as harsh as imprisonment, depending on the particular scenario.

How IRS Penalties Are Calculated

Penalty for Filing Late:  If a return is not filed by the due date, you may have to pay a failure-to-file penalty.  This amount is typically 5% per month, but not greater than 25%. The penalty is based on the unpaid amount as of the due date.

Penalty for Paying Late:  The Failure-to-Pay Penalty of .5% of unpaid taxes per Month is incurred each month after taxes due are not paid.

NOTE: If there is no tax balance due (or you qualify for a refund) there will be no penalty for late filing.

Avoiding Penalties

Out of Country:  Individuals who live and work out of the country automatically receive a two month extension without filing a Form 4868. However, a return must be filed by October 15 at the latest.

Reasonable Cause:  The IRS does also waive penalties for those individuals and businesses that had Reasonable Cause to not file or pay on time.  This is a more subjective reason to be reserved for the most extreme circumstances, and to be determined by the IRS.

Extend Your Deadline:  An individual or business may elect to file for an extension of up to 6 months. This is not an extension of time to pay; this is an extension of time to file.  

Obviously the best way to avoid penalties and interest is to simply file on time! However, sometimes this is easier said than done.  There are many different services available for use by individuals and businesses to extend filing deadlines. www.expressextension.com is a simple online tool that can help you avoid late penalties by filing for an extension.  Ironically, one of the easiest ways to incur a penalty is also very easy to avoid.

As this year’s tax deadlines are ominously approaching, many businesses and individuals are stress fully and hastily preparing to file their tax returns. But it doesn’t have to be that way! Each year, an increasing amount of forward thinking individuals are filing Tax Extensions with the IRS.  There are many different ways to file, but there is none simpler than Express Extension.

This Year, ExpressExtension has expanded their services to include the following:

*Business Tax Extensions – IRS Form 7004
*Personal Tax Extensions – IRS Form 4868
*Non-Profit Tax Extensions – IRS Form 8868

Although the IRS does not require a reason for filing a Tax Extension, there are many reasons that Express Extension may be beneficial.

1) Express Extension is an IRS authorized E-File Provider. The IRS has stated numerous times that E-Filing is the quickest and most secure way to file. Express Extension will send an email confirmation to the filing party as soon as the IRS processes the application.

2) Many Accountants and Tax Professionals are much busier in the spring than they are in the Fall. Filing for a Tax Extension makes it easier to get a proper amount of time with a Tax Professional.

3) Organizing all of the paperwork required for filing a tax return can be a daunting task. Extending the deadline for up to 6 months allows the taxpayer to organize all of their tax related documents so that they can better prepare returns and get the most credits and refunds as possible.

4) Self Employed Individuals funding a SEP IRA will also benefit from a Tax Extension because the deadline for funding this type of account is the tax due date.

With its streamlined design and user-friendly interface, Express Extension will walk through each step of the process in less than 10 minutes. Everything is spelled out in easy to read instructions, not confusing tax jargon. However, if assistance is needed, Express Extension’s dedicated team of customer service representatives will gladly answer any questions about the process via phone, email, or text chat. Express Extension is IRS authorized, safe, secure and encrypted.

Not only is the service of Express Extension beyond reproach, it is also much more affordable that its closest competitors. With prices starting at $9.95 and not exceeding $14.95, it is easily the best value of any Tax Extension Software on the market.

Express Extension is the safest, fastest, most efficient, and most affordable way to file a tax extension with the IRS.

Each Tax Return is unique to the person filing, and each year there seems to be more and more information to organize. Although your tax return may have been simple in previous years, it usually gets more and more detailed each year. For every major life event, taxes can get more complicated. For example, if you have a child, adopt a child, buy a house, pay for college, or start a business (these are just a fraction of the possibilities) your taxes become more complicated.

Due to the increased complications involved in filing a tax return, each year more and more people are filing Tax Extensions for their Personal, Business, or Non-Profit Tax Returns. The IRS accepts Personal Tax Extensions by filing a Form 4868. This allows individuals 6 additional months to file their tax return. Business Tax Extensions are filed with the IRS by using Form 7004. This allows businesses an additional 5-6 months to file their tax returns. Non-Profit organizations can also extend their tax deadline by filing an IRS Form 8868. This provides Non-Profit Organizations an automatic 3 Month Extension. They may then file for a Non-Automatic additional 3 month extension after that.

These fantastic options allow individuals and businesses to properly organize all of their necessary tax documents so that they can be sure that they are receiving the appropriate Tax Credits, and paying the right amount. Tax Professionals appreciate it when people file for an extension, rather than bombard an already busy person with much more work on the busiest week of their year. This is another incentive for individuals and organizations to file for a tax extension; accountants and tax professionals are less busy in the summer months than in April. Most tax preparers are neck deep in paperwork by the time the tax deadline rolls around.

Fortunately, these IRS Tax Extension Forms can also be E-Filed online. ExpressExtension.com allows Individuals, Businesses, and Non-Profit Organizations to file Tax Extensions with the IRS. The beauty of E-Filing is that there is no need to leave your home or office, buy postage, or risk it getting lost in the mail. According to the IRS, E-Filing is the easiest, fastest, and most secure way to file any IRS Form.

One of the greatest things about filing with Express Extension is their dedication to quality customer support. If you have any questions about the filing process or would like a little help along the way, you can call, email or chat online with their Tax Extension team anytime from their US-Based Customer Support Center in Rock Hill, South Carolina. You can email the team at support@expressextension.com or chat with them online from the website: ExpressExtension.com Overall, it is hard to go wrong with an easy-to-use system, a helpful team along the way, and affordable pricing options.

The Internal Revenue Service starts 2012 tax season by announcing that taxpayers have until April 17 to file their tax returns. The IRS encourages taxpayers to e-file as it is the best way to ensure accurate tax returns and get faster refunds.

Taxpayers will have until Tuesday, April 17, to file their 2011 tax returns and pay any tax due because April 15 falls on a Sunday, and Emancipation Day, a holiday observed in the District of Columbia, falls this year on Monday, April 16. According to federal law, District of Columbia holidays impact tax deadlines in the same way that federal holidays do; therefore, all taxpayers will have two extra days to file this year. Taxpayers requesting an extension will have until Oct. 15 to file their 2012 tax returns.

Here is a video from the IRS about Tax deadline Extended to April 17:

The deadline to file personal tax returns with the IRS for the 2012 Tax Season has been extended to Tuesday, April 17, 2012. The traditional deadline of April 15 falls on a Sunday this year. Since April 15th falls on a weekend, the official deadline had to be changed. It could not be the following Monday (April 16) either due to the fact that April 16th is Emancipation Day. Emancipation Day is considered to be a holiday for the District of Columbia, and Federal Law declares that agencies such as the IRS must observe such holidays of the District of Columbia.

This will be the second year in a row in which the deadline for most tax returns will not be on the traditional deadline of April 15. Tax returns were also later last year due to the Emancipation Day holiday.

The same deadline applies to anyone filing a Personal Tax Extension as well as a normal tax return. If a Tax Extension is applied for, this does not postpone the tax payment. It only extends the time in which to file the tax return itself with the IRS.

Any taxes due must still be paid by the traditional April 15 deadline, but with a tax extension, the completed return does not need to be filed until October 15. This 6 month extension allows tax preparers and others to get the most out of any credits and refunds.

One of the easiest ways to apply for a tax extension is through www.ExpressExtension.com  The Fast and Easy-To-use System makes tax extensions simple and easy.  The entire process takes only a few minutes to complete. If you have any questions about the process, you can contact the Tax Extension Team from their Rock Hill, SC Support Center at 704.234.6000 or send an email to support@expressextension.com.

One of the greatest things about filing with Express Extension is their dedication to quality customer support.  If you have any questions about the filing process or would like a little help along the way, you can call, email or chat online with their Tax Extension team anytime from their US-Based Customer Support Center in Rock Hill, South Carolina. You can email the team at support@expressextension.com or chat with them online from the website: ExpressExtension.com  Overall, it is hard to go wrong with an easy-to-use system, a helpful team along the way, and affordable pricing options.

It is becoming increasingly popular for businesses and individuals to delay their tax return filing for up to six months. This late filing is possible because the IRS allows Individuals, businesses, and Non Profit Organizations to file a Tax Extension form that can delay the filing deadline 3 to 6 months. This does not delay the tax payment. It only affects the Filing of a tax return, but many are finding that a little extra time to prepare the return gives people a better chance to organize important documents and get the most out of their refunds.

The Form 7004, otherwise known as a Business Tax Extension allows businesses to apply for an automatic 5 to 6 month tax extension. This tax form can be used by Multi-Member LLCs, C-Corporations, S-Corporations, Partnerships, Trusts and Estates. Certain Partnerships, Trusts, and Estates are only able to apply for a 5 month tax extension; this is determined by which tax form they would be filing for their return. Business Extensions are due by March 15.

Another common Tax Extension Form is the IRS Form 4868. This is used by individuals to file a 6 month extension for personal tax returns. This can also be used by Sole Proprietors, contractors, and Single-Member LLCs. Just like personal tax returns, the deadline to file a Form 4868 is April 15.

Non-Profit Organizations wishing to file a tax extension can do so by filing Form 8868. This form grants a 3 month extension of time to file. They can then file an additional 3 month extension of time after that. Groups that can file this return include Non-Profits and Exempt Organizations.

People may file these returns for different reasons, but one of the most common reasons is the simple fact that businesses, organizations, and even individuals are very busy and there is not a strong enough benefit to file by the early deadline.

Traditionally, these forms were all filed on paper by postal mail. Thankfully Express Extension has developed an E-Filing Program for this tax to be filed online. In only a few minutes, any of these IRS forms can be E-Filed. This process can be completed rather quickly, but even if you have questions about the process there are many examples of help text and video guides to help guide taxpayers through the process. Express Extension also offers live support from our Support Center in Rock Hill, SC. You can contact the Tax Extension experts at 704.234.6000 or email them at support@expressextension.com  they even offer Live Chat Support Mon-Fri from their website.