26 THE QUEENS COURIER • OCTOBER 17, 2019 FOR BREAKING NEWS VISIT WWW.QNS.COM
TAX TIPS
It’s Tax Time Again
for the Millions
Who Got
an Extension
BY JOHN SAVIGNANO, CPA
Back in the spring, millions of Americans asked for and
received six additional months to file their federal income
tax returns.
Now, the extension is almost up. The new deadline is
Tuesday.
A record 15 million people — about one in 10 filers —
received automatic, six-month filing extensions for their
2018 returns, according to the Internal Revenue Service.
(That was up from 14.7 million the year before.)
Sweeping changes to the tax code under the Tax Cuts and
Jobs Act of 2017 were behind the torrent of extensions,
according to tax professionals and the I.R.S.
Missing the extended deadline could mean penalties
from the I.R.S. for failing to file and — if the filer still
owes taxes — failure to pay. The extension allowed an
extra six months to file a return but no extra time to pay.
(Late filers are supposed to estimate what they owe and
pay by the original April deadline.) So, penalties may
already be accruing for those who haven’t paid, and will
grow if the October deadline is missed, too.
If someone owes taxes but doesn’t have the money to
pay the full balance, it’s still best to file a return. People
are often reluctant to call the I.R.S., but it’s better to
initiate communication with the agency and discuss your
circumstances, he said. Contact the I.R.S., explain your
situation and seek an agreement to pay the bill over time.
That way, you’ll avoid late-filing penalties.
You’re better off filing even if you can’t pay.
The penalty for filing late is 5 percent of the tax that is
owed, for each month (or partial month) the payment is
late. The failure-to-pay penalty is 0.5 percent of the
amount unpaid, also charged monthly. (Penalties are
capped at 25 percent of the tax owed.)
The I.R.S. is often willing to waive the penalties for those
filing or paying late for the first time. An abatement is not
guaranteed but if you have a good track record, more
often than not, they’ll abate it.
The good news is that if you’re due a refund, you won’t
owe any penalties. But if you are owed money, it’s best to
file a return and collect it because there is a window of
three years for collecting a refund. So anyone who is due
money should file as soon as possible.
John Savignano is a partner with Savignano Accountants
& Advisors located at 47-46 Vernon Blvd., Second Floor,
in Long Island City. If you have any questions or require
additional information, please call John at 718-707-0955.
SAVIGNANO
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