Penalties of $1 billion were waived for taxpayers and businesses with unpaid taxes in 2020 and 2021 that owed less than $100,000 annually.
IRS Waives Nearly $1 Billion in Penalties for Taxpayers. (PHOTO: WSJ)
Good news for many folks! The IRS, which deals with taxes, is giving a break to lots of people. This break means you can save money. Almost 5 million people can benefit, but there’s a catch—it’s only for a little while, until April. Here’s the deal: If you didn’t pay your taxes on time in 2020 or 2021 and you owe less than $100,000 each year, the IRS is saying, “No need to worry about extra fees for now!” They are letting it slide and forgiving some of the fees they usually charge for paying late. This started right away and will last until April. But be aware that starting in April 2024, they’ll go back to enforcing those fees. The reason behind this is that during the COVID-19 pandemic, the IRS didn’t send reminders like they usually do. So, if you got a notice about your late payment, that’s all you got. They say it’s because of the pandemic’s effects.
According to The US SUN report, lots of people—around 5 million—and some businesses might get a break from paying extra taxes, thanks to the IRS. To be eligible, you must have been late in paying taxes for 2020 and 2021, owe less than $100,000, and earn less than $400,000 in either of those years. Use specific tax forms, like 1040 or 1120. If you got a notice about what you owe between February 5, 2022, and December 7, 2023, you qualify. If you’ve already paid penalties, you’ll likely get that money back. The IRS wants to help during this unusual time, according to Commissioner Daniel Werfel. Tax experts suggest it’s a good time to catch up on overdue fees from December to April. So, if you fit the criteria, it’s a chance to sort out your taxes without facing extra charges.
Just keep in mind that even though reminders were on hold, if you didn’t fully pay your taxes after the first notice, the fees are still adding up. So, it’s a good idea to take care of it if you can before April!
