Common Tax Penalties

Looking at tax penalties

Filing and paying taxes is something everyone has to do, and neglecting it could lead to penalties. If you want to avoid penalties, you should make sure to pay your taxes on time and pay them correctly. Today in the LongSchaefer blog, we’ll discuss how to avoid common tax penalties.

Avoid These Common Penalties

Here are some common penalties that you’ll want to avoid this tax season:

Late Payment Penalty

Late payment penalties are the most common penalties that occur. You’ll need to make sure to pay your taxes by the deadline in April. If you can’t pay by then, you can file for an extension to file later but this doesn’t extend the time for payment so you should pay in as much of the tax due that you can with the extension. You can also use a credit card to cover the payment for the time being, even if this isn’t ideal.

Late Filing Penalty

The late filing penalty is even more expensive than the late payment penalty. You need to make sure to file your taxes before the deadline, even if you don’t think you can pay the tax bill. Figuring out a payment alternative is a possibility, whereas there’s no forgiveness or working with the IRS if you forget to file or forget to file an extension.

Accuracy Penalty

Sometimes people make mistakes on their tax return. Typically, the mistakes are small and aren’t a big deal if they weren’t purposeful. However, if noticeable amounts of income are left off a return, you’ll have to pay an accuracy penalty which can be quite expensive.

Fraud Penalty

Fraud is much worse than the accuracy penalty. This penalty applies to those who purposely alter their taxes or evade them. If you lie on your tax return and get caught, the penalty will be significant and can be criminal as well as civil.

Health Insurance Penalty

You’re required to carry a minimum health insurance policy throughout the year. If you or other members of your household didn’t have minimum coverage, you’ll be subject to this penalty.

Choose LongSchaefer as Your Tax Advisor

The easiest way to avoid penalties is by letting a tax professional help you with your taxes this year. They can help you file in a timely manner and let you know when payment needs to be made. The tax advisors at LongSchaefer can help you file your taxes and advise you on ways to maximize your return and minimize what you owe. We can also help you start tax planning for next year. Contact us today for more information and see how we can help you.

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