With millions of Americans still struggling to navigate COVID-19 and its impact on the economy, the IRS has elected to once again postpone the date that your federal income tax return is due. The new deadline of May 17, which will give you an extra month or so to get your paperwork in order this year, isn't quite as generous as last year's extension, which ran to July 15 -- but, if you're playing catch-up, it's better than nothing.
Still, the clock is ticking for all of us -- including the millions of taxpayers that will be facing an array of new, and potentially complicated, tax issues. They include, and , just to name a few.
As such, the best thing you can do is to start now. (This advice applies every year.) Filing early means aand getting any .
Though the deadline to file your 2020 taxes is May 17, you can ask for even more time by. We've got all of the details about how to do that below.
Can I file my income taxes sooner than May 17?
Yes. And the sooner you file, the faster you will get your refund -- if one is owed. Most refunds are issued within three weeks -- though this year, with the IRS still working through a backlog of stimulus payments, it might take longer. The agency began accepting returns on Feb. 12, 2021.
What happens if I miss the deadline?
There's an important distinction between filing late and paying late. If you need more time to prepare your tax return, you can request an extension from the IRS using Form 4868. If approved, you'll get an extra five months, making Oct. 15 the deadline for your tax paperwork this year.
But here's a big, hairy note of caution: Even if you're approved for the extension, you still have to pay your estimated taxes by May 17 in order to avoid penalties. (Here's what you need to know about According to the IRS, the late payment penalty is "0.5% of the tax owed after the due date, for each month or part of a month the tax remains unpaid, up to 25%." That's just to start; if you fail to pay for an extended amount of time, the fines increase. And there is a "failure-to-file" penalty as well..)
But the IRS may waive the penalty if you can show "reasonable cause for the failure to pay on time."
Can I request an extension for my business?
Yes. According to the IRS, businesses can file Form 7004 to request a deferral until May 17. But pretty much the same rules apply as with an individual; the business still needs to pay its estimated taxes by May 17 but can wait until Oct. 15 to file the return.
Can I file for an extension for my state tax return?
Maybe. The rules vary from state to state, so you'll need to check with your state tax agency to learn about your specific options for an extension.
If you need help filing your state or federal taxes, there are plenty of-- or you can always .