The IRS shared a reminder for tax-exempt organizations that have a filing deadline of May 16, 2022. Filing is mandatory, so if you need more time, you should request an extension as soon as possible.
Which Form should tax-exempt organizations file?
Tax-exempt organizations would file one of four tax forms for a return:
Form 990-series annual information returns (Forms 990, 990-EZ, 990-PF)
Form 990-N, Electronic Notice for Tax-Exempt Organizations Not Required to File Form 990 or Form 990-EZ
Form 990-T, Exempt Organization Business Income Tax Return (other than certain trusts)
Form 4720 Return of Certain Excise axes Under Chapters 41 and 42 of the Internal Revenue Code
Electronic filing for tax-exempt organizations
You should e-file to save time on processing and to avoid inevitable delays that occur when filing by paper. E-filing also reports your compliance with the IRS.
However, for tax-exempt organizations filing a Form 990, 990-EZ, 990-PF or 990-T for 2021, it’s mandatory to file electronically.
For organizations filing Form 990-N, the IRS website states, “organizations eligible to submit Form 990-N must do so electronically and can submit it through Form 990-N (e-Postcard) on IRS.gov.”
Requesting an extension for tax-exempt organizations
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The end of tax season was officially April 18, 2022, which means the IRS is diving into enforcements and catching up on notices. What should you do, and what should you expect if you missed the filing deadline?
One-Time Penalty Relief
For late filers who have a history of filing and making payments on-time, you may qualify for one-time penalty relief. One-time penalty relief could reduce your owed balance by removing penalties such as interest. It’s also referred to as penalty abatement.
What Happens to Your Refund When You File Late?
Although your return is late, you should still file your taxes as soon as possible. If you are expecting to receive a return, but you filed late, you may have some of the balance offset and receive a smaller refund.
If you qualify for one-time penalty relief, you will not owe a balance and you can expect to receive the full refund.
Because you filed late, your refund will likely be late as well. The IRS has a huge backlog and the returns that are e-filed on time are top priority. Filing by paper and filing late will increase the likelihood of delays.
Penalties for Filing Your Taxes Late
Penalties for late filing range based on how late you file. Filing a few days late could result in interest on your balance. You will continue to accrue interest daily until you file, or the IRS will take more serious enforcement action.
Some of these more serious actions include levies and account liens, or even garnishing your wages to pay the balance owed.
Tax Debt Relief
Cases of tax returns that are years behind, or accounts that have been levied may benefit from professional assistance. Tax debt relief is available for many cases, in the form of payment agreements, offer in compromise, penalty abatement, and innocent spouse relief.
Call Optima for a free consultation today at (800) 536-0734. Our tax professionals may be able to assist you with your case.
There were about 1.5 million taxpayers that didn’t file a return in 2018. The IRS announced that it has $1.5 billion in tax refunds from 2018 and gave taxpayers until the end of the season to claim their money. If you missed out on claiming your refund, there are steps you can take to make sure you claim other refunds from 2019 and on.
How to claim an old tax refund
Taxpayers have a three-year deadline to claim unpaid tax refunds for federal taxes. While there are instances where it may not be required for you to report your income, filing helps the IRS ensure that you receive any refunds you may be eligible for.
The first thing you should do is make sure that you filed for the year in question. If you missed the filing deadline, you should still file as soon as possible to avoid IRS enforcement. To file a return from 2018 and prior years, you’ll have to file by paper. The final page of your current Form 1040 will tell you which IRS center to send your return to, as it may differ based on your state.
Low and moderate-income families could be eligible for larger refunds by qualifying for Earned Income Tax Credit. This credit is based on the number of children in a household and filing status.
Returns for 2019 and on can be e-filed.
What happens to your refund if you owe back taxes?
The refund is generally applied to any amount that you owe to your state or the IRS. It can be used to offset other overdue balances such as child support and student loans as well.
Optima Tax Relief assists clients with large tax liabilities reach a resolution. Give us a call for a free consultation today at (800) 536-0734.
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