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  • Alex Jaacovi

Why you should file your late taxes

As the famous saying goes, “nothing is certain except for death and taxes”. While we may not be able to avoid either of these inevitabilities, many people find themselves procrastinating when it comes to filing their taxes. Whether it’s due to a lack of time or simply a fear of the complicated process, some individuals may choose to skip filing their taxes altogether or file them late. However, there are several important reasons why it’s essential to file your taxes even if they are late.


Firstly, failing to file your taxes can result in financial penalties. The IRS imposes a late filing penalty of 5% of the unpaid taxes for every month that the return is late, up to a maximum of 25%. This means that if you owe $10,000 in taxes and fail to file your return for five months, you could end up paying an additional $2,500 in penalties alone. Additionally, if you owe taxes and fail to pay them, you may face additional penalties and interest charges, which can quickly add up over time.


Secondly, filing your taxes is required by law. The Internal Revenue Service (IRS) requires all citizens and residents of the United States to file their taxes each year, regardless of whether they owe taxes or not. Failing to file your taxes is considered a criminal offense and can result in serious consequences, including fines, jail time, and even the loss of your passport.


Thirdly, filing your taxes is essential for maintaining financial records. Even if you don't owe any taxes, filing your taxes creates a record of your income and financial activity for that year. This can be helpful for future reference when applying for loans or financial assistance, as it provides a clear and detailed snapshot of your financial situation.


Fourthly, filing your taxes can lead to financial benefits. If you are owed a refund, you will only receive it by filing your taxes. Additionally, if you have overpaid your taxes throughout the year, filing your taxes can result in a refund or credit that can be applied to future tax years.


Finally, filing your taxes can help you avoid stress and anxiety. Procrastinating on filing your taxes can create unnecessary stress and anxiety, which can negatively impact your mental health and wellbeing. By taking the time to file your taxes, even if it is late, you can alleviate this stress and feel a sense of relief and accomplishment.


In conclusion, while it may be tempting to procrastinate or avoid filing your taxes altogether, there are several important reasons why it’s essential to file your taxes even if they are late. Failing to file your taxes can result in financial penalties, legal consequences, and the loss of important financial records. Additionally, filing your taxes can lead to financial benefits and help you avoid stress and anxiety. So, if you haven't already filed your taxes this year, it's time to gather your documents and get started. Remember, it's never too late to file your taxes and take control of your financial future.


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