Some things to know about July 15 tax deadline
(AP) – It’s time to do your taxes — no more delays. As the coronavirus pandemic took hold this spring, the federal government postponed the traditional April 15 filing deadline until July 15.
The move provided some economic and logistical relief for taxpayers dealing with the disruptions and uncertainty brought on by lockdowns, school closures and shuttered businesses. But now that new deadline is rapidly approaching.
Taxpayers must file or seek an extension by the new deadline or face a penalty. The IRS is expecting about 150 million returns from individuals and as of last count, it had received almost 139 million. A few answers:
DO I HAVE TO?
Yes. In most cases, you must file and pay your taxes by July 15.
Taxpayers who need more time can request an extension on the IRS website. That will give them until Oct. 15 to file. However, an extension to file does not mean added time to pay. So those planning on filing later should estimate what they owe and make that payment by July 15.
I CAN’T PAY NOW,
WHAT DO I DO?
Go ahead and file your taxes even if you cannot pay.
The IRS is willing to set up payment plans or make other arrangements with taxpayers who cannot pay in full. Many of those can be set up online. And the penalty for failure to file will be much more expensive than the failure to pay, says Kathy Pickering, chief tax officer at H&R Block.
The IRS is still processing and issuing refunds, most within 21 days.
Those getting refunds will be paid interest, dating back to April 15, if they file on time. The interest rate is 5% per year through June 30. Starting July 1, it drops to 3% per year. The interest is compounded daily for refunds. Any refund issued after July 1 will get a blended rate.
CAN I DO THIS
Yes, you can file or pay your taxes online. The IRS urges taxpayers to use electronic options to support social distancing and speed the processing of returns, refunds or payments. The agency is still working its way through a backlog of mail that built up during its closure in response to the pandemic.