Editing Form 1040 (section)

==Payments, refunds, and penalties==

{{main|IRS penalties}}

There is a three-year limit to when individuals can claim a tax refund. However, payments that are due must be paid immediately.<ref name="efile_penalties">{{cite web |url=http://www.efile.com/what-are-the-penalties-for-not-filing-a-tax-return-or-not-to-pay-taxes-IRS-penalty-list/ |title=IRS Penalties for Not Filing a Tax Return or Not Paying Taxes Owed |publisher=efile.com |access-date=December 31, 2015 |archive-date=December 20, 2015 |archive-url=https://web.archive.org/web/20151220073046/http://www.efile.com/what-are-the-penalties-for-not-filing-a-tax-return-or-not-to-pay-taxes-IRS-penalty-list/ |url-status=dead }}</ref>

In addition it is possible to apply one's refunds to next year's taxes<ref>{{cite web |url=https://ttlc.intuit.com/questions/1901277-how-do-i-apply-my-refund-to-next-year-s-taxes |title= How do I apply my refund to next year's taxes?  |publisher=TurboTax |access-date=December 31, 2015}}</ref> and also to change one's mind later.<ref>{{cite web |url=https://ttlc.intuit.com/questions/1901186-what-if-i-chose-to-apply-my-federal-refund-to-next-year-s-taxes-filed-and-later-changed-my-mind |title=What if I chose to apply my federal refund to next year's taxes, filed, and later changed my mind? |access-date=December 31, 2015 |publisher=TurboTax |archive-date=March 4, 2016 |archive-url=https://web.archive.org/web/20160304070701/https://ttlc.intuit.com/questions/1901186-what-if-i-chose-to-apply-my-federal-refund-to-next-year-s-taxes-filed-and-later-changed-my-mind |url-status=live }}</ref>

[[Image:Form 4868, 2010, with pen glasses phone.jpg|thumb|upright=0.8|left|Considering whether to file an extension for the 2010 tax year with Form 4868]]

An automatic extension until October 15 to file Form 1040 can be obtained by filing Form 4868.  There is a penalty for not filing a tax return by April 15 that depends on whether the individual got a filing extension and the amount of unpaid taxes. However, since the maximum penalty is 25% of unpaid taxes, if an individual has paid all their taxes, there is no penalty for not filing.<ref name="efile_penalties" /><ref name="eight_facts">{{cite web |url=https://www.irs.gov/uac/Newsroom/Eight-Facts-on-Late-Filing-and-Late-Payment-Penalties |title=Eight Facts on Late Filing and Late Payment Penalties |access-date=December 31, 2015 |date=April 18, 2013 |publisher=Internal Revenue Service}}</ref>

In addition to making sure that one pays one's taxes for the year by [[Tax Day]], it is also important to make sure that one has paid partial taxes throughout the tax year in the form of estimated tax payments or employer tax withholding. If one has not done so, then a tax penalty may be assessed.<ref>{{cite magazine|url = https://www.forbes.com/sites/advisor/2011/05/17/adjusting-your-withholding-and-estimated-tax-payments/|title = Adjusting Your Withholding and Estimated Tax Payments|last = Blankenship|first = Jim|date = May 17, 2011|access-date = January 1, 2016|magazine = [[Forbes]]|archive-date = November 26, 2015|archive-url = https://web.archive.org/web/20151126192318/http://www.forbes.com/sites/advisor/2011/05/17/adjusting-your-withholding-and-estimated-tax-payments/|url-status = live}}</ref> The minimum amount of estimated taxes that need to be paid to avoid penalties depends on a variety of factors, including one's income in the tax year in question as well as one's income in the previous year (in general, if one pays 90% of the current year's tax liability or 100% of the previous year's tax liability during the tax year, one is not subject to estimated tax penalty even if this year's taxes are higher, but there are some caveats to that rule).<ref name=p505ch1>{{cite web|url = https://www.irs.gov/publications/p505/ch01.html|title = IRS Publication 505, Chapter 1. Tax Withholding for 2015|access-date = January 1, 2016|publisher = [[Internal Revenue Service]]|archive-date = March 5, 2016|archive-url = https://web.archive.org/web/20160305022613/https://www.irs.gov/publications/p505/ch01.html|url-status = live}}</ref><ref>{{cite web|url = https://turbotax.intuit.com/tax-tools/tax-tips/Small-Business-Taxes/Estimated-Taxes--How-to-Determine-What-to-Pay-and-When/INF12007.html|title = Estimated Taxes: How to Determine What to Pay and When|publisher = [[TurboTax]]|access-date = January 1, 2016}}</ref> Employer withholding is also treated differently from estimated tax payment, in that for the latter, the time of the year when the payment was made matters, whereas for the former, all that matters is how much has been withheld as of the end of the year (though there are other restrictions on how one can adjust one's withholding pattern that need to be enforced by the employer).<ref name=p505ch1/><ref>{{cite web|url = http://www.hrblock.com/free-tax-tips-calculators/tax-help-articles/General-Filing/Underpayment-of-Estimated-Tax.html?action=ga&aid=27047&out=vm|title = Underpayment of Estimated Tax|publisher = [[H&R Block]]|access-date = January 1, 2016|archive-date = March 4, 2016|archive-url = https://web.archive.org/web/20160304051807/http://www.hrblock.com/free-tax-tips-calculators/tax-help-articles/General-Filing/Underpayment-of-Estimated-Tax.html?action=ga&aid=27047&out=vm|url-status = live}}</ref>

When filing Form 1040, the penalty for failing to pay estimated taxes must be included on the form (on line 79) and included in the total on line 78 (if a net payment is due). The taxpayer is not required to compute other interest and penalties (such as penalty for late filing or late payment of taxes). If the taxpayer does choose to compute these, the computed penalty can be listed on the bottom margin of page 2 of the form, but should not be included on the amount due line (line 78).<ref>{{cite web |url=https://www.irs.gov/instructions/i1040gi/ar02.html#d0e63714 |publisher=Internal Revenue Service |title=1040 (2015) |access-date=June 28, 2016}}</ref><ref>{{cite web|url = http://money.stackexchange.com/questions/66741/where-is-payment-for-failure-to-file-and-failure-to-pay-penalties-included-on-fo|title = Where is payment for failure-to-file and failure-to-pay penalties included on Form 1040?|access-date = June 28, 2016|publisher = money.stackexchange.com|archive-date = August 15, 2016|archive-url = https://web.archive.org/web/20160815133731/http://money.stackexchange.com/questions/66741/where-is-payment-for-failure-to-file-and-failure-to-pay-penalties-included-on-fo|url-status = live}}</ref>