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Never Filed a 2021 Tax Return? You Can Still Submit One in 2023

The Motley Fool logo The Motley Fool 2/2/2023 Maurie Backman
Frustrated man at desk with head in his hands. © Getty Images Frustrated man at desk with head in his hands.

Filing a tax return can be a time-consuming process. And it's one you may not have had time for last year. 

If that's the case, you might still be sitting on a 2021 tax return that hasn't been submitted (remember, in 2022, people were filing 2021 returns). And that means you may be missing out on a tax refund you're owed.

The good news, though, is that it's not too late to file your 2021 tax return if you didn't get around to it last year. But you should also know that if you owe money on that year's tax return, you could be in for some pretty steep penalties.

When your tax return is overdue

If you didn't file your 2021 tax return and are owed money from the IRS, guess what? There's no penalty for being late. 

That might seem counterintuitive, but think about it this way. If you were due a refund last year for your 2021 taxes and you didn't submit your return, it means the IRS got to keep your money for longer. So why would it penalize you in that situation?

That said, you get three years to file a tax return past its original deadline and claim a refund. So since we're still within three years of April of 2022, which is when 2021 taxes were due, you can file your return and arrange for your refund to hit your bank account

In fact, the average tax refund for the 2021 tax year was $3,121. And you may be in line for a similar amount of money, so the sooner you get your taxes done, the sooner you can collect that cash. 

Prepare to pay more if you owe the IRS money

You won't face a penalty if you file your 2021 taxes this year and are due a refund. But if you owe the IRS money from 2021, you'll be penalized in a few different ways. 

First, you'll owe 5% of your tax debt for each month or partial month your return is late past the original deadline, up to a total of 25%. Plus, you'll owe interest and penalties on your actual bill. 

That's why you should really do your best to get your 2021 return filed as soon as possible if you think you owe money. If you sit on that return, the IRS could still come after you for the money it's owed. So you're better off getting your taxes filed and working out how to pay your tax bill. 

If you don't have enough money in your savings account to cover your full tax bill, the IRS will generally let you sign up for an installment plan. That way, you pay off your tax bill over time.

Being late with a tax return isn't ideal in any scenario. If you're owed money, being late means delaying your refund. If you owe the IRS money, being late means incurring added penalties. But it's also not too late to file your 2021 taxes, and the sooner you do, the better.


Our picks for best tax software

Our independent analysts pored over the perks and user reviews for the most popular tax provider services to land on the best-in-class picks to file your taxes. Get started by reviewing our list of the best tax software.

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