According to a recent survey, Americans find filing their taxes to be only slightly more bearable than going to a funeral! But if you think filing is a pain – consider what will happen if DON’T file your return on time. Consider these tips from tax expert Steve Elliott:
First, you’ll get a letter. Elliott says that within a few months of missing the deadline, the Internal Revenue Service will mail a friendly letter outlining the two acceptable reasons why they didn’t receive your return: Either it’s lost in the mail, or you died! Otherwise, you’ll be urged to file your taxes immediately.
Meanwhile, you’ll ALREADY owe a late penalty plus interest. The penalty alone can cost up to HALF of your tax bill! However, there’s no maximum on the interest – so the longer you wait to pay, the more you’ll owe.
If you continue to ignore your taxes, the IRS will prepare a return for you. Unfortunately, it’ll be based on information gathered from employers and banks, and it won’t include deductions. That means you’ll be charged the maximum tax possible.
The IRS will also be in touch with your employer. To help pay your bill, they’ll order your boss to deduct a larger percentage of your paycheck, meaning you’ll have less money to take home.
Oh, and one more thing, you might go to prison.
With that said, the deadline for filing taxes was extended to April 18th. Need we say more?
Additional source: John Tesh: Intelligence for Your Life (www.tesh.com).