How To File Late Taxes: Quick Guide

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It’s best to file your tax returns on time, but sometimes deadlines are missed. However, with the Internal Revenue Service (IRS), filing late is always better than never. Be prepared for penalties if you owe taxes and missed the deadline to file. Additionally, understand that the IRS has a time limit for claiming refunds.

What To Do If You Missed the Deadline

Missing the deadline doesn’t mean you’re out of options.

• Expect a tax refund? File as soon as possible. The clock to claim a refund runs out after three years.
• Owe taxes? File now, even if you can’t pay the full bill yet. Filing stops the failure-to-file penalty.
• Filed an extension but didn’t file the return? File right away. An extension avoids the filing penalty, but it does not stop payment penalties or interest.

You can avoid filing late by submitting a time extension application with Form 4868.

Key Question: Do You Owe Taxes or Expect a Refund?

Your situation depends on whether you owe taxes or expect a refund.

If You’re Owed a Refund

If the IRS owes you a tax refund, you must file your past-due tax returns within three years to claim that money. This includes tax credits, such as the earned income credit (EIC) or the child tax credit (CTC), as well as refunds from estimated quarterly taxes or withholding taxes taken from your paycheck.

If You Owe Taxes

If you owe back taxes, the IRS will accept a lump sum payment or negotiate an installment plan that lets you pay over time.

Penalties for Filing Late

These are the penalties the IRS applies when you file late:

Failure-to-File Penalty

The failure-to-file penalty is equal to 5% of the unpaid taxes for each month or partial month that a return is late, up to a maximum of 25% of the unpaid tax.

If your return is more than 60 days late, the minimum failure-to-file penalty is the smaller of $525 or 100% of the tax required to be shown on the return for returns filed in 2026.

Failure-to-Pay Penalty

The failure-to-pay penalty equals 0.5% of the unpaid taxes for each month or partial month that your bill goes unpaid. The penalty will not exceed 25% of your unpaid taxes.

When Both Apply

If you have a failure-to-file penalty in addition to a failure-to-pay penalty, the former will be reduced by the amount of the latter. In this instance, the maximum combined failure to file and failure to pay penalty is 5%. 

Keep In Mind

Interest starts accruing on unpaid federal taxes as soon as the deadline to file passes and will continue to accrue until the balance is paid in full.

Unlike penalties, interest does not have a predetermined limit. Instead, it compounds daily based on the federal short-term rate plus additional percentage points set by the IRS.

Quick Examples

• You owe $2,300 and file three months late. Failure-to-file penalties apply each month until the return is filed, along with failure-to-pay penalties and interest. Filing the return stops the failure-to-file penalty even if payment comes later.
• You are set to receive a $1,200 refund and file eight months late. No penalties apply. As long as the return is filed within three years, the refund is still paid.
• You haven’t filed in five years, but were owed refunds. Only the most recent three years of refunds can be claimed. Older refunds are forfeited.

What To Do Now If You Missed the Deadline

Here are the next steps to take if you didn’t file on time.

Step 1: Check If You Qualify for Extra Time

Federally declared disasters or certain hardships can qualify you for additional time to pay. Qualifying hardships include the following:

• Fire 
• Civil disturbance
• Inability to obtain records
• Death, critical illness or unavoidable absence of the taxpayer or immediate family members
• IRS system issues that caused the taxpayer to miss the filing deadline

Step 2: File ASAP — Even If You Can’t Pay

Filing the return stops the failure-to-file penalty, even if payment is delayed.

Step 3: Pay What You Can Today

The following payment methods are accepted by the IRS:

• Bank transfer
• Same-day wire
• Debit card
• Credit card
• Check 
• Money order
• Cash via a retail partner

Step 4: Choose a Payment Plan If Needed

Short-term plans cover balances paid within 180 days. Long-term plans allow monthly payments.

Step 5: Ask About Penalty Relief

Penalty relief may be available if circumstances beyond your control, such as a dishonored check, prevented timely filing or payment.

How Many Years Late Can You File?

It is never too late to file taxes if you owe the IRS money. Penalties add up quickly, and interest continues to accrue until the balance is paid off, so it makes sense to pay your taxes as soon as you can or reach out to the IRS and set up a payment plan. You have up to three years to file a return if the federal government owes you a tax refund.

It’s important to note that if you fail to file, the IRS may file a tax return for you. That return may not reflect any tax deductions or exemptions you deserve, which could leave you with a large tax bill.

If this happens, the IRS will send you a Notice of Deficiency. You will have 90 days to file a return with the accurate deductions, exemptions and income.

Filing Late When You’re Self-Employed or Own a Business

Small business owners and the self-employed also must file tax returns, even if they’re late — and they have unique circumstances to consider, including:

• Protecting their Social Security benefits, which they might lose for any year that they fail to file
• Avoiding issues securing business loans
• Forfeiting refunds from estimated quarterly tax overpayments
• Preventing the IRS from filing a substitute return on their behalf that might not accurately reflect their credits and deductions

If You Need To File Back Taxes

If you’re filing returns from prior years, the process is similar — but requires extra documentation and care.

1. Gather Required Records

You’ll need income documents for each year you’re filing, including W-2s, 1099s and any records needed to claim deductions or credits. Business owners may also need mileage logs, expense records and payroll documentation.

2. File Electronically When Possible

E-filing speeds up processing and reduces delays that can add to penalties and interest. Late filers generally receive confirmations and refunds faster by filing electronically.

3. Submit Payment or Request a Payment Plan

The IRS accepts lump-sum payments or installment plans. Taxpayers who owe $50,000 or less can apply online, while higher balances require Form 9465.

State Taxes: Don’t Forget the Second Deadline

State filing deadlines and penalties are separate from federal rules. Even if you’re caught up with the IRS, you could still face penalties at the state level. Payment plan options also vary by state.

Common Mistakes Late Filers Make

Late filers often make avoidable mistakes that increase penalties or delay refunds.

• Not filing because they can’t pay the full balance
• Ignoring IRS notices
• Missing the three-year refund deadline
• Forgetting to file a state tax return

How To Avoid Filing Late Next Year

Note federal filing deadlines ahead of time and set a calendar reminder. Tax Day is generally on April 15, but if the 15th falls on a weekend or holiday, it moves to the next business day.

Also, keep income records organized year-round so you don’t have to waste time searching for information you need to file.

Lastly, file an extension, if needed, to avoid the failure-to-file penalty.

Key Takeaways

• Filing late is better than not filing at all.
• Refunds are only available for three years.
• Penalties and interest grow when taxes go unpaid.
• Payment plans and relief options are available.

Dawn Allcot and Cynthia Measom contributed to the reporting of this article.

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