The Internal Revenue Service (IRS) imposes penalties on taxpayers who fail to file their federal income tax returns on time.
For the 2025 tax year, if your return is more than 60 days late, the minimum failure-to-file penalty is $510 or 100% of the unpaid tax, whichever is less.
Key Penalties for Late Filing and Payment
| Penalty Type | Rate per Month | Maximum Penalty | Notes |
|---|---|---|---|
| Failure-to-File | 5% | 25% | Applies to unpaid taxes; minimum $510 if over 60 days late |
| Failure-to-Pay | 0.5% | 25% | Applies to unpaid taxes; continues until tax is paid in full |
| Combined Penalties | Up to 5% | 47.5% | Failure-to-file and failure-to-pay penalties can combine |
Who Must File a Tax Return?
You are generally required to file a federal income tax return if:
- Your gross income exceeds the IRS filing threshold for your age and filing status.
- You are self-employed with net earnings of $400 or more.
- You owe special taxes, such as the alternative minimum tax or household employment taxes.
- You received distributions from a health savings account or retirement plan.
Even if you are not required to file, you may want to do so to claim a refund of any federal income tax withheld.
How to Avoid or Reduce IRS Penalties
1. File Your Tax Return on Time
The deadline to file your 2024 federal income tax return is April 15, 2025. If you cannot meet this deadline, request an extension using Form 4868, which grants an automatic six-month extension to October 15, 2025. However, this extension applies only to filing, not to payment .
2. Pay Any Taxes Owed Promptly
Even if you file for an extension, you must pay any taxes owed by the original due date to avoid the failure-to-pay penalty and interest charges.
3. Set Up a Payment Plan
If you cannot pay the full amount owed, consider setting up an installment agreement with the IRS to pay over time. This can help reduce additional penalties and interest.
4. Seek Penalty Relief
If you have a valid reason for failing to file or pay on time, such as a natural disaster or serious illness, you may qualify for penalty relief. The IRS considers reasonable cause for failure to comply with tax obligations .
Avoiding the IRS’s $510 penalty for late tax filing in 2025 requires timely action. Ensure you file your tax return by April 15, 2025, or request an extension if needed.
Pay any taxes owed by the due date to minimize penalties and interest. If you encounter difficulties, consider setting up a payment plan or seeking penalty relief.
Staying informed and proactive can help you maintain compliance and avoid unnecessary financial burdens.
FAQs
What happens if I file my tax return late but am due a refund?
If you are due a refund, there is no penalty for filing late. However, you must file within three years of the original due date to claim your refund.
Can I avoid penalties by filing for an extension?
Filing for an extension gives you more time to file your return but does not extend the time to pay any taxes owed. To avoid penalties, pay the estimated amount by the original due date.
How can I check if I owe any penalties or taxes?
You can check your tax account information, including any amounts owed, by logging into your account on the IRS website.