Tag: taxes

Tax Penalties: The Reality of Filing Late vs. Paying Late

Uncertainty, fear and confusion are only some of the familiar feelings that flood our thoughts during the inevitable tax season. If you a
re prepared, organized and don’t anticipate an outstanding balance this year, you should be sweat free. If you do, however, have an unpaid balance and don’t have the cash to pay in time, not all is lost! Make the financial decision that has the least impact on your bank account.

FILING your taxes late and PAYING your taxes late hold completely different penalties. In general, here’s what you can expect to pay for each scenario.

(Based on information provided by the IRS)

What if I don’t have the money to pay on time? (failure-to-pay penalty)

  • Every month or part of a month that the tax goes unpaid after it’s due, a 5% penalty is charged on the unpaid taxes (up to 25%)
  • If you filed on time and opted for a payment plan, the penalty drops to 25% once the plan is in effect
  • If you paid up to 90 percent of your taxes and you file for an extension, you may not be responsible for the failure-to-pay penalty (note ̶  you will still pay interest on any outstanding taxes)

What if I file late and I still owe tax? (penalty for failure to file)

  • Every month or part of a month that the return was late, a 5% penalty is charged on unpaid taxes (up to 25%)
  • If you file over 60 days past the due date, the minimum penalty is the lesser of $135 or 100 percent of unpaid tax.


As a general rule, it is important to always file on time regardless of if you can pay, as the penalty for failure to file is typically much higher than the failure to pay penalty.If you need help learning about and preparing your taxes this year, please visit our live chat at our website (www.semaphoretax.com) to get in contact with one of our experienced tax professionals, or call us at 866-736-2444. We’re excited to hear from you!




Revised Publications: 3 out of 5 People Still Need to File

With almost 59 million tax returns filed so far, the IRS estimates that three out of five taxpayers have yet to file their tax returns, according to statistics released today. Are you one of them?

For those of us still working on their taxes, the IRS added three revised publications to IRS.gov just this week. These publications will help businesses and individuals understand how to figure depreciation as well as pension options.


Publication 946, “How to Depreciate Property” explains how you can recover the cost of business or income-producing property through deductions for depreciation. The publication was updated to reflect the extension of expiring tax provisions in legislation signed into law on Dec. 19.

Publication 4587, “Payroll Deduction IRAs for Small Businesses” explains that individuals saving in a traditional IRA may be able to receive some tax advantages on the money they contribute, and the investments can grow tax-deferred.

Publication 4334, “SIMPLE IRA Plans for Small Businesses” explains how a SIMPLE (Savings Incentive Match Plan for Employees of Small Employers) IRA plan offers great advantages for businesses that have 100 or fewer employees (who earned $5,000 or more during the preceding calendar year) and that do not have another retirement plan.

The IRS constantly adds revised tax forms, publications, instructions and tax information to IRS.gov. They encourage taxpayers to frequently visit IRS.gov, including the forms and pubs page for all current forms and publications, updates and changes, and additional information.

#TaxTipTues: Where’s My Refund?

After you answer the most important question: “How much will I get on my refund?”, wondering “Where is my refund?” is not far off.

Finding out the status of your refund is simple.
Visit IRS.gov and select “Where’s my refund” to check the status of your refund. The IRS updates the site every 24 hours.

Note: If you have mailed your tax return in, it can take up to 4 weeks before it will be available to view online.
In order to check the status of your refund, have the following handy:
1.) Social security number
2.) Your filing status
3.) The exact amount you’re expecting back.

It’s that simple. Thanks for reading this week’s #TaxTipTues. Stay in touch with us on Twitter.

This post is to be used for informational purposes only and does not constitute legal, business, or tax advice. Each person should consult his or her own attorney, business advisor or tax advisor with respect to matters referenced in this post. Semaphore assumes no liability for actions taken in reliance upon the information contained herein.