IRS Waives $1.2 Billion In Penalties For Late Filers Of 2019, 2020 Taxes
The IRS is waiving $1.2 billion in fines assessed on late tax filers.
Almost 1.6 million people and businesses will receive a refund – this breaks down to about $750 for each taxpayer.
The Internal Revenue Service said Wednesday it will waive and refund penalties for Americans who filed their 2019 or 2020 tax returns late, as the agency struggles with a massive Covid-imposed backlog that has frustrated taxpayers and politicians.
Almost 1.6 million taxpayers who have already forked over failure to file penalties for their 2019 or 2020 returns will automatically be refunded by the end of next month, adding up to more than $1.2 billion in total refunds, the agency said in a statement.
To qualify taxpayers must file any 2019 or 2020 tax returns by September 30th of this year.
A failure-to-file penalty is charged when taxpayers do not file their return by the due date; the fine is a percentage of the taxes that weren’t paid on time. It is calculated at 5 percent of unpaid taxes for each month or part of a month that the return is filed late, up to a maximum of 25 percent.
For example, unpaid taxes of $10,000 could see a penalty of $500 per month, up to a maximum of $2,500.
To qualify for the refunds, taxpayers must file any 2019 or 2020 tax returns that were originally due in 2020 and 2021 by Sept. 30 of this year.
There are some situations where the penalties will not be forgiven.
These include fraudulent tax returns being submitted, cases where the penalties were determined by a court, and the failure to pay penalty.
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