Extensions and penalties

I filed and extensions and was wondering what the penalties are that I should anticipate

Employee Tax Expert

Hi there!

Filing an extension pushes your filing deadline to October 15, but it does not extend your deadline to pay.

What to expect depends on your situation:

If you are due a refund: You owe $0 in penalties. The IRS does not penalize you for filing late when they owe you money.
If you paid 100% of your tax bill by April 15: You owe $0 in penalties as long as you file your return by October 15.
If you owe taxes and didn't pay by April 15:
- Failure-to-Pay Penalty: 0.5% of your unpaid tax balance per month (capped at 25%).
- Interest: Accrues daily on the unpaid balance from April 15 until you pay it off.
- Failure-to-File Penalty (Only if you miss the October 15th deadline): 5% of unpaid taxes per month (capped at 25%). Because you filed an extension, you avoid this massive penalty as long as your paperwork is submitted by October 15.

Answer

Employee Tax Expert

Hi there!

Filing an extension pushes your filing deadline to October 15, but it does not extend your deadline to pay.

What to expect depends on your situation:

If you are due a refund: You owe $0 in penalties. The IRS does not penalize you for filing late when they owe you money.
If you paid 100% of your tax bill by April 15: You owe $0 in penalties as long as you file your return by October 15.
If you owe taxes and didn't pay by April 15:
- Failure-to-Pay Penalty: 0.5% of your unpaid tax balance per month (capped at 25%).
- Interest: Accrues daily on the unpaid balance from April 15 until you pay it off.
- Failure-to-File Penalty (Only if you miss the October 15th deadline): 5% of unpaid taxes per month (capped at 25%). Because you filed an extension, you avoid this massive penalty as long as your paperwork is submitted by October 15.