Why does ‘Tax Day’ fall later than usual again in 2023? A local holiday is to thank
Procrastinators have been granted a mild reprieve on their taxes once again this year thanks to another fluke of the calendar.
“Tax Day,” typically April 15, is set for April 18 this year. It’s the fourth year in a row the infamous occasion has been delayed.
The rare mini-extension, per the IRS, is a consequence of April 15 falling on a Saturday and a local holiday in Washington, DC. And it means you’ll have one additional weekend to get your return filed before facing the consequences of being late, or to file for an extension to give yourself more time to finish.
Here’s what to know about 2023 tax deadlines, including how to get an extension if three extra days isn’t enough:
Why is Tax Day on the 18th this year?
Tax Day falls on April 18 this year because Emancipation Day, a holiday in Washington marking the end of slavery in the District of Columbia, will be observed on April 17 this year.
“By law, Washington, D.C., holidays impact tax deadlines for everyone in the same way as federal holidays,” the IRS explains. “The due date is April 18, instead of April 15, because of the weekend and the District of Columbia’s Emancipation Day holiday, which falls on Monday, April 17.”
The same holiday bumped tax day to the 18th in 2022, and the COVID-19 pandemic pushed the filing deadline in 2021 and 2020.
What happens if you file taxes late?
The consequences you’ll face if you file your federal taxes late depend on whether or not you’re getting a refund, according to the tax prep company TurboTax.
“If you have a refund coming from the IRS — as about three out of four taxpayers do every year — then there is no penalty for failing to file your tax return by the deadline, even if you don’t ask for an extension,” TurboTax says.
Still, the company adds, filing late will delay the arrival of your refund and may prevent you from making some tax elections when filing.
If you owe money to the IRS and haven’t filed and paid by April 18, “you’ll likely end up owing a late payment penalty of 0.5% per month, or fraction thereof, until the tax is paid.”
And “you’ll also likely owe interest on whatever amount you didn’t pay by the filing deadline.” “If you didn’t get an extension, you are also looking at a late filing penalty of 5% of the unpaid tax per month, plus interest,” TurboTax says.
At the state level in North Carolina, there are also potential penalties for being late on your taxes.
“Returns filed after the due date are subject to a failure to file penalty of 5% of the net tax due for each month, or part of a month, the return is late (maximum 25% of the additional tax),” the state Department of Revenue says.
How to file a tax extension 2023
The deadline to file for an extension with the IRS is also April 18 this year.
To do so, you need to fill out an extension form a irs.gov/forms-pubs/extension-of-time-to-file-your-tax-return that includes an estimate of your tax liability.
If you get an extension, you’ll have till October 16 to file.
Still, the agency adds, “an extension of time to file your return does not grant you any extension of time to pay your taxes.” That means you should “pay any amount due” when you file for your extension.
In North Carolina, “a taxpayer who is granted an automatic extension to file a federal income tax return will be granted an automatic extension to file the corresponding North Carolina income tax return,” the state Department of Revenue says. “In order to receive an automatic State extension, the taxpayer must certify on the North Carolina tax return that the person was granted an automatic federal extension.”
You can also request a six-month extension on your state tax return at ncdor.gov/taxes-forms/extensions.
This story was originally published March 3, 2023 at 9:34 AM.
