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| Issue Number: Tax Tip 2022-42Taxpayers should file their tax return on time to avoid costly interest and penalty fees Taxpayers should file their tax return by the deadline even if they cannot pay their full tax bill. Taxpayers who owe tax and don't file on time, may be charged a failure-to-file penalty. This penalty is usually five percent of the tax owed for each month, or part of a month that the tax return is late, up to 25%. If an individual taxpayer owes taxes, but can't pay in full by the April 18, 2022, deadline, they should: File their tax return or request an extension of time to file by the April 18 deadline.
To get an extension to file, taxpayers must do one of the following:
Pay as much as possible by the April 18 due date.
Set up a payment plan as soon as possible.
Interest is based on the amount of tax owed and for each day it's not paid in full. Interest rates are determined every three months and can vary, based on type of tax; for example, individual or business-tax liabilities. More information is available on the Interest on Underpayments and Overpayments page of IRS.gov.
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