Skip to contentNerdwallet icon

What Happens If You File Taxes Late? How Penalties Work

The failure-to-file penalty is usually 5% of the tax owed for each month your return is overdue, up to 25% of the bill.

Sabrina Parys
Tina Orem
Arielle O'Shea
Updated
If you owe taxes and didn't file your federal income tax return by the tax deadline, there may be consequences in the form of IRS penalties and interest.

What happens if you file late and owe taxes?

Failure-to-file penalty

The failure-to-file penalty is assessed if you owe taxes and fail to submit your tax return on time. The penalty is 5% of your unpaid taxes for each month or partial month the return is late, up to a maximum of 25% of your tax bill.

Late-payment penalty

The late-payment penalty is assessed if you fail to pay your tax bill by the deadline. The penalty is 0.5% of your unpaid bill for each month your outstanding taxes are unpaid, up to 25% of your outstanding bill, plus interest.

More details on penalties

  • The IRS could hit you with both a late-filing penalty and a late-payment penalty if your bill and return are both overdue. When both penalties are issued in the same month, the late-filing penalty is reduced by the amount of the late-payment penalty for that month.
  • If your return is more than 60 days late, the minimum failure-to-file penalty is $525 or the entire amount of tax owed, whichever is smaller. The late-filing penalty maxes out after five months of your return being late, but other penalties and interest may continue to accrue.
  • Some late filers may be eligible for tax relief in the form of a penalty abatement if they meet certain conditions. For example, you might be eligible for penalty relief if you have a reasonable explanation for filing late or if this is your first time missing the deadline.
» MORE: How to set up a payment plan with the IRS

What happens if you file taxes late but don't owe anything?

There is usually no penalty for filing your tax return late if you're owed a refund. But if you're required to file by law, you should still plan to submit your return as soon as possible.
Also, keep in mind that you typically have just three years to claim any tax refunds due to you. This means that if you didn't file your tax return last year but think you were due a refund, you only have until 2028 to file a tax return for that year to claim it.
» MORE: How much do you have to make to file taxes

How to avoid a penalty for filing taxes late

A tax extension can get you an extra six months, until Oct. 15, to finish your tax return. The deadline to request an extension is Tax Day.
If you do get an extension, an important thing to know is that it only gives you more time to file your tax return, not more time to pay your taxes. You are still required to submit an estimated tax payment by the April 15 deadline. Otherwise, anything you owe past the tax deadline might be subject to that late-payment penalty and interest.
Some people, such as victims of natural disasters, certain members of the military or Americans living overseas, may automatically get more time to file. .

How long can you go without filing taxes?

While the government usually has just six years to charge you with criminal tax evasion, it has forever to collect the taxes you owe and assess penalties. In addition to the failure-to-file and late-payment penalties, these things could happen to you when the IRS catches up:
  • A substitute return: If you fail to file but the IRS has some information needed to calculate your taxes, such as your W-2 form, you may be notified by mail that it has filed a return on your behalf. It won’t consider the tax credits, deductions or other tax breaks you may have taken if you’d done your taxes.
  • Lost refunds: You may be missing out on money you’re owed. In most cases, you get a three-year window to file previous years’ returns. Once this window closes, you forfeit your tax refund.
» MORE: How to file back taxes
Explore more on
Taxes
Article sources
NerdWallet writers are subject matter authorities who use primary, trustworthy sources to inform their work, including peer-reviewed studies, government websites, academic research and interviews with industry experts. All content is fact-checked for accuracy, timeliness and relevance. You can learn more about NerdWallet's high standards for journalism by reading our editorial guidelines.
Back to top
Related articles
Tax Relief and Resolution: 5 Ways to Deal With Tax Debt
Sabrina Parys's profile picture
2
By Sabrina Parys, Tina Orem
Head, Person, Face
Guide to IRS Customer Service and Phone Numbers
Tina Orem's profile picture
2
By Tina Orem, Sabrina Parys
IRS Free File: What It Is, How It Works
Sabrina Parys's profile picture
2
By Sabrina Parys, Tina Orem