The Internal Revenue Service (IRS) has entered the next phase of the 2024/2025 tax season. With the filing deadline for taxes passed last month, many taxpayers may now expect to get their refunds. Generally, if you miss the deadline to file your taxes without requesting an extension, you will be penalized with interest and penalty. However, some people do not have to worry about this because their tax deadline has been extended beyond the regular April 15 deadline.
What happens if you miss the deadline?
If you missed the deadline to file your taxes last month, the IRS recommends that you file them as soon as possible. The longer you wait, the more interest accumulates as a penalty for not filing on time. Furthermore, depending on your circumstances, the sooner you file, you may have to pay a higher penalty or none at all.
People choose not to file their taxes for a variety of reasons, including their inability to pay federal income taxes. If this happens to you, the IRS always recommends that you file, even if you cannot afford to pay the tax. Individuals who do not file their taxes on time face a ‘failure to file’ penalty.
This penalty is equal to 5% of the tax payable (less any tax paid on time and available credits) for each month you do not file the return. This penalty might result in a maximum charge of 25%. If you are more than 60 days late filing your return, your minimum penalty is the amount mentioned or 100% of the underpayment, whichever is smaller. However, if you are eligible for a refund, you may avoid paying this penalty.
These states have an extension for filing
While many taxpayers may receive a notification from the IRS regarding their late income tax returns, if you fall into one of these states’ special circumstances, you are eligible for an extension to file your taxes. According to the IRS’s official announcement on tax deadline extensions, communities in twelve states that qualified for disaster relief had their deadline to file their taxes extended to May 1 this month. Additionally, some states have until October or November of this year to file.
While the May 1 deadline has already passed, the states and affiliated counties listed below have until the end of the year to file:
In 2025, Los Angeles County in California and Boone, Greenbrier, Lincoln, Logan, McDowell, Mercer, Mingo, Monroe, Raleigh, Summers, Wayne, and Wyoming counties in West Virginia will be affected by severe storms from February.
What is the average refund this year?
For individuals who filed their taxes on time, the IRS pays an average refund of $2,945. If you haven’t gotten your return yet but are expecting it, you may follow its status using the IRS’s ‘Where’s My return?’ tool. If you owe money to your state or federal government, your refund may be withheld.
For taxpayers who want to decrease their tax due for the fiscal year 2025/26, there are legal and IRS-approved methods available. One approach to accomplish this is to remember to claim capital losses if you own an asset. You can also make IRS contributions to reduce your tax bill. However, the takeaway is that you should file your taxes, even if your tax liability is beyond your control.