Late Tax Filing for Dummies

IRS late filing application

When tax time comes around, we here at the Antisocial Network tend to be leery of the "community help" forums at places like TurboTax, mainly because we know just how clueless a lot of the people offering  that "help" are in real life. We'd rather go to the IRS website or get help from the likes of J. K. Lasser, if the truth be told. After all, we definitely wouldn't want to find ourselves in trouble for taking "tax advice" from the likes of Denise Caldwell (now attributed to Jerusha Hardman) at least based on her Sapling.com article, "Can I Wait and File Taxes Next Year?"

Never mind Caldwell's introduction,

"Normally the tax deadline is April 15 of each year, although the tax deadline for tax year 2010 returns has been moved to April 18¹. All taxpayers are expected to have their returns in to the IRS by the deadline and, to encourage voluntary compliance, the IRS assesses penalties against taxpayers who do not meet the deadline..."

...the fact is that you can wait all you want. Hell, some people never even bother to file. The question is not whether you can wait, it's whether you should wait! And in almost every case, the answer is, "No." Caldwell actually got that right – what even moderately aware person wouldn't?

Caldwell's answer breaks down into two "considerations," as eHowians called them: deadline and statute of limitations, and devoted more than a third of the post to a rather unlikely scenario of someone not filing for that breathlessly-awaited refund. According to Denise, you either have to pay a fine plus interest if you owe taxes; or can get your refund absorbed if you don't file for a refund for three years. Well and good...

You would think that someone who knows enough to explain that,

"If you owe tax and you wait until next year to file, you will be assessed a 'failure to pay' penalty, a 'failure to file' penalty, and interest on any unpaid tax. The 'failure to file' penalty is 5 percent of the unpaid tax, while the 'failure to pay' penalty is ½ of 1 percent of the unpaid tax for as long as it remains unpaid or until the 25 percent maximum penalty is reached..."

...would have mentioned that the 0.5% penalty is per month. Oh, yeah, and that you could avoid the "failure to file" penalty by sending in a request for an extension.
But she didn't. That's about the quality of "tax help" we've come to expect from all those Dumbass of the Day freelancers at eHow (and, by extension, at Sapling).

¹ And here Demand Media always claimed they wanted "evergreen" content. Feh.

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DD - TAXES