In my last post on Late filing of 2010 Income tax return we looked at the case of people who don't owe any money to IRS. Infact they expect some sort of refund..

Like I mentioned, in such case, the filing of tax returns is very straight forward. It is business as usual.

In this post, we'll look at cases of people who owe to the money to IRS and are also late in filing tax returns.

If you owe money to IRS and are late filing your 2009 2010 income tax returns, then there will be some additional expenses that IRS will try to recover in following ways-

1. There will be a penalty for late filing. The penalty can be few hundred dollars.

2. Interest rate on the money you owe. This depends on the amount of time by which that person is late in filing returns.

So, as you can see, there is definitely a big financial disadvantage in filing late returns. But still even if a person is late, s/he should not delay any further since the interest charges otherwise will keep on increasing.

So, incase you are late in filing, still go ahead and file as soon as possible your 2010 Income Tax returns.