Still Filing a Paper Return? Be Sure You Understand the “Timely Mailed = Timely Filed” Rule

The IRS considers a paper return that’s due April 15 to be timely filed if it’s postmarked by midnight on April 15. But dropping your return in a mailbox on the 15th may not be sufficient.

For example, let’s say you mail your return with a $15,000 payment on April 15, but the envelope gets lost. You don’t figure this out until a couple of months later when you notice that the check still hasn’t cleared. You then refile and send a new check which the IRS receives on June 10th.  Despite your efforts to timely file and pay, you’re hit with failure-to-file and failure-to-pay penalties, which is assessed on the unpaid tax at the rate of 5% a month not to exceed 25%, totaling $1,500.  This $1,500 is in addition to the interest that you will be charged.

To avoid this risk, use certified or registered mail or one of the private delivery services designated by the IRS to comply with the timely filing rule, such as:

  • FedEx Priority Overnight
  • FedEx Standard Overnight
  • FedEx 2Day
  • UPS Next Day Air Saver
  • UPS 2nd Day Air
  • UPS 2nd Day Air A.M.

Beware: If you use an unauthorized delivery service, your return isn’t “filed” until the IRS receives it. For example, DHL is no longer an authorized delivery service.

If you’re concerned about meeting the April 15 deadline, another option is to file for an extension. However, it is important to remember that an extension to file is not an extension to pay. If you believe you will owe income tax, it is important for you to pay an estimate of your tax liability in order to avoid late payment penalties and interest. We can help you determine if filing for an extension makes sense for you.

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