Missed the US tax return deadline? Here’s what to do

Filing your tax return late Sprintax

Every international student or J-1 participant in the US is obliged to file a tax return before the 15 April deadline (due to Covid-19 outbreak, the tax filing deadline has been extended to 15 July in 2020).

But what happens if you don’t file your return on time? What should you do next?

Filing late

Firstly it’s important to note that, by not filing your tax return, you can severely jeopardise your chances of securing a US visa or Green Card in the future.

The second point to keep in mind is that failure to file a tax return may result in you being hit with fines or penalties.

There are two different types of penalties that you may be subjected to – late filing and late payment.

The late filing fees are much more significant than the late payment costs. That’s why it’s a good idea to file your tax return as soon as you can, even if you’re not in a position to pay your tax bill.

Simply put, the sooner you file, the less you’ll have to pay in penalties.

US tax late filing & payment penalties

  • A failure-to-file penalty may apply if you did not file by the deadline. Similarly a failure-to-pay penalty may also apply if you did not pay all of the taxes you owe by the tax filing deadline.
  • The failure-to-file penalty is generally more severe than the failure-to-pay penalty. This is why you should file your tax return on time each year, even if you’re not able to pay all the taxes you owe by the due date.
  • The penalty for filing late is normally 5% of the unpaid taxes for each month (or part month) that a tax return is late. That penalty starts accruing the day after the tax filing due date and will not exceed 25% of your unpaid taxes.
  • If you do not pay your taxes by the tax deadline, you will normally face a failure-to-pay penalty of 0.5% of your unpaid taxes. That penalty applies for each month or part of a month after the due date and starts accruing the day after the tax-filing due date.
  • If both the 5% failure-to-file penalty and the 0.5% failure-to-pay penalties apply in any month, the maximum penalty that you’ll pay for both is 5%.
  • If you file your return more than 60 days after the due date or extended due date, the minimum penalty is $135 or 100% of the unpaid tax (whichever is less).

What should you do if you can’t afford to pay your outstanding tax liability in full?

Firstly, you should pay as much as you can when you’re filing your tax return. This way you can minimize any penalties and interest charges imposed.

Next, you can contact the IRS and request a payment plan or installment agreement which will allow you to pay your tax bill in set amounts every month.

To establish a payment plan, simply apply online with the IRS payment agreement.

Avoid US tax penalties and fines

Due a tax refund?

If you’re entitled to a tax refund, you will not have to pay any penalties for filing your tax return late.

You have until 14 April 2022 (15 October 2022 with an extension) to file a 2018 tax return if you are due a refund for that tax year.

If you don’t file by then, the US Treasury will keep your hard earned money!

Double check your State’s tax deadline

Did you know that not every State has their tax deadline set for 15 April (due to Covid-19 outbreak, the tax filing deadline has been extended to 15 July in 2020)?

If you’re obliged to submit a tax return for any of the following states, you’ll still have time to meet the deadline.

  • Iowa – April 30th 2019
  • Virginia – May 1st 2019
  • Louisiana – May 15th 2019

How to tell if you owe money to the IRS or you’re due a tax refund

Sprintax is the only online Federal and State self-prep tax software for nonresidents in the US.

We take the stress out of US tax prep. Our system will assist you in preparing fully compliant Federal and State tax returns and also enable you to use any tax deduction and benefits you’re entitled to and maximize your legal tax refund.

The average State tax refund that Sprintax customers received last year was $328.

How Sprintax will help you?

When you create your Sprintax account you’ll be asked a few easy questions. Once you complete the short form, you will then be able to download your fully completed and compliant 1040NR or 1040NR-EZ (nonresident tax return) based on the information you provided.

Sprintax is also the ‘go-to’ tax preparation software for numerous major universities in the US including, Columbia University, Arizona State University, Illinois Institute of Technology and Cornell University.  We’re also the nonresident partner of choice for TurboTax.

With Sprintax you can:

  • Save time and stress!
  • Determine your residency status
  • Prepare a fully compliant US tax return
  • Maximize your State tax refund
  • Avail of our 24/7 Vita Qualified Live Chat facility

Prepare your US tax return today!

Easy US tax filing

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Hey I'm Stacy! I'm dealing with US taxes and can't wait to help you prepare your tax return! I've been working with taxes for like forever, so you can totally trust my expertise. Sprintax can make things much easier for you. Check out my blog posts and feel free to ask me any questions.

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