The IRS Warns You Could Get Fined for Forgetting This on Your Taxes
You may get hit with a penalty if this isn't included on your return.
Whether you're a first-time filer or you've been prepping returns for years now, filing your taxes can be a stressful and confusing time for anyone. Some people opt to pay someone else to do it, while others might take advantage of tax preparer software like TurboTax. But at the end of the day, you are responsible for making sure your correct and complete financial information is submitted to the Internal Revenue Service (IRS) every tax season. If not, you could be hit with significant penalties from the tax agency. Read on to find out what experts say could get you must not forget to leave off your return.
You must sign and date your tax return before sending it to the IRS.
You are responsible for submitting a valid and complete return into the IRS by the tax deadline. "A return isn't considered valid unless it is signed. Both spouses must sign if the return is filed jointly. The return should be dated," the IRS explains on its website.
A signature and date is required for both paper returns and returns submitted online. To qualify as a signed tax return, it must be signed by the filer on the line designated for signature or include the tax preparer's stamped, typed, signed, or printed name and social security number, employer identification number, or preparer tax identification number, according to Boston University Financial Assistance.
Missing these two important details could leave your return unprocessed and not submitted in the eyes of the IRS. "If you missed signing your tax forms, the IRS will not process your return," says Edward Mellett, a financial expert and founder of WikiJob. Mark Valderrama, a tax expert and CEO of the Aquarium Store Depot, adds, "without a signature and date, the document will be deemed not submitted at all."
The agency can fine you if you submit an unsigned return.
An unsigned and undated return could seem like a simple mistake on your end, but it might end up costing you. "Once you recognize your error, your return may be considered late, resulting in the imposition of IRS fines and interest," Valderrama warns. So in 2022, if you don't remedy your mistake by the April 18 deadline, you may be hit with a Failure to File Penalty and subsequent interest.
The IRS also confirms the possibility of this on its website. "A return that is not signed by the taxpayer (or an authorized individual) fails to meet the requirement to file that return, and may subject the taxpayer to penalties for failure to file," the tax agency says.
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The IRS will send your return back and notify you if it is not signed.
The IRS says it will return unsigned income tax returns to taxpayers, alongside a letter requesting that they sign the return and resubmit it to be processed. If you initially filed before the tax deadline and then file a proper income tax return upon request, the tax agency will likely choose not to fine you, even if you resubmit after the official tax deadline.
But if the IRS finds that you purposely refused to sign the return for specific reasons, you are at a higher risk of being penalized. "If it is determined that the failure to sign a return was an intentional attempt to avoid civil or criminal penalties associated with signing a false return, then the penalty for failure to file should be duly explored to the fullest extent of the law," the agency says.
And the IRS will also let you know if you owe a penalty.
If you don't file your tax return by the due date, you could be subject to the Failure to File Penalty. According to the IRS, the penalty will require you to pay a percentage of the tax you didn't pay on time. And the agency will send you either a notice or a letter if you owe it.
"We calculate the Failure to File Penalty based on how late you file your tax return and the amount of unpaid tax as of the original payment due date (not the extension due date)," the IRS explains. "Unpaid tax is the total tax required to be shown on your return minus amounts paid through withholding, estimated tax payments and allowed refundable credits."
But you might also be able to dispute the penalty by calling a number the IRS will provide on your notice, or by writing the agency a letter. "We may be able to remove or reduce some penalties if you acted in good faith and can show reasonable cause for why you weren't able to meet your tax obligations," the IRS says.