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Still haven't filed your taxes? How to avoid penalties or lost refunds

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Still haven't filed your taxes? How to avoid penalties or lost refunds

After the epic storms deluged California in early 2023, the IRS and the state Franchise Tax Board gave most taxpayers in the state until mid-November to file their returns and pay what they owed.

After the epic storms deluged California in early 2024, the IRS and the Franchise Tax Board gave taxpayers in San Diego County until mid-June to file their returns and pay what they owe. For everyone else in the state, Monday remains the filing deadline — at least at the moment.

If you don’t pay at least a goodly chunk of your 2023 taxes by then, you will be penalized automatically, even if you file for an extension by Monday night.

Tax experts say the best course of action is to file your return on time and pay everything you think you owe. The IRS, nonprofit groups and commercial tax-preparation companies offer multiple ways to prepare and file returns for free online.

If you can’t afford your tax bill, you have some choices to make by Monday at 11:59 p.m., when the deadline is due to arrive.

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There is a chance President Biden will approve Gov. Gavin Newsom’s request for a major disaster declaration covering Los Angeles, Ventura, Butte, Glenn, Monterey, San Luis Obispo, Santa Barbara, Santa Cruz and Sutter counties by the end of the day Monday, which could trigger a delay in the tax-filing deadlines. Counting on a last-minute reprieve, however, is a gamble with potentially high stakes, depending on how much you owe in taxes for 2023.

What are the penalties for not filing?

Tax experts say that if the IRS owes you a refund, you won’t face a penalty for not filing your return. Instead, you’ll have a different deadline: If you wait more than three years to file a return for that year, you’ll sacrifice your claim to the money.

If you have taxes due, Andy Phillips, director of H&R Block’s Tax Institute, said it’s important to file your return or file for an extension on time, even if you can’t cover the balance at the moment. That’s because the penalty for not filing can be up to 10 times the penalty for filing but not paying on time.

The IRS will charge you 5% of what you owe every month until you file, with the penalty capped at 25%, Phillips said. But it also charges interest, and there’s no cap on how much interest you’ll owe. Currently, the interest rate is 8%, compounded daily.

The Franchise Tax Board’s penalty is 5% per month, capped at 25%; the state’s tax code makes no mention of interest charges. It also imposes a lower penalty on people who owe no more than $540.

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Both the feds and the state offer hardship exceptions.

Need more time to gather your paperwork? Both the IRS and the Franchise Tax Board offer six-month extensions on the deadline for filing an annual return to anyone who applies.

There is a catch, though: Even with an extension, you’ll still face an underpayment penalty if you don’t pay at least 90% of what you owe by the end of the day Monday, Phillips said. But at least you won’t be hit with the added penalty for not filing.

What are the penalties for not paying?

For the record:

3:59 p.m. April 12, 2024An earlier version of this story said the IRS penalty for unpaid taxes was 5% of the unpaid balance plus 0.5% per month, up to a maximum of 25%, plus interest. That is the Franchise Tax Board’s penalty. The IRS charges 0.5% per month, up to a maximum of 25%, plus interest.

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The IRS charges .5% of the original underpayment per month the balance is not paid, capped at 25%, plus interest. The Franchise Tax Board charges 5% of the underpayment plus .5% per month, capped at 25%, with interest, which is currently 8%.

Phillips said the IRS applies a penalty only if you paid less than 90% of what you owed by the deadline. If you are facing a penalty, he said, you need to consider how that amount (including interest) stacks up against the cost of taking out a loan, using your credit cards or pulling cash out of savings or profitable investments.

One option is to enter a payment plan with the IRS, which will cut the underpayment penalty in half, Phillips said — although you’ll still be paying interest on the amount you owe while you’re chipping away at your balance. As long as you’re compliant with the plan, he said, the IRS won’t go into forced-collection mode.

You can apply for a payment plan with the IRS through the agency’s website.

The Franchise Tax Board also offers installment plans that allow you to pay your tax debt over time, typically three to five years. The plans are available only to taxpayers who owe less than $25,000 and who’ve filed all required returns in the previous five years. Applications are accepted online, by mail or by calling (800) 689-4776.

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The state offers to cancel a late-payment or late-filing penalty for taxpayers who are otherwise in compliance, but a taxpayer can claim this relief only once in their lifetime. In addition, the offer applies only to penalties for tax years 2022 or later.

To apply for a one-time abatement, return a completed form FTB 2918 by mail or call 800-689-4776 and request one.

How does the IRS collect penalties?

Regardless of whether you file a return, the IRS and the Franchise Tax Board will have collected data from employers, banks, mutual funds and other sources about your income and tax payments. And they will use that information to calculate what they believe you owe (or what they owe you). They won’t refund your overpayment automatically — you’ll get that only if you file a return — but they can force you to pay the taxes you’ve underpaid.

Phillips said the IRS typically starts by sending a letter asking you to pay up. If you don’t, it can seize a portion of your wages, your Social Security benefits and your investments. As a last resort, he said, it can put a lien on your house and force its sale.

To avoid going into collection, Phillips said, you might offer to pay a compromise amount — for example, if you can show that you weren’t responsible for the underpayment. The feds accept only a small percentage of the applications for this kind of relief, he said; it’s more likely that the agency will put you into a payment plan or temporarily suspend collection efforts until your income grows. If you find yourself in the latter category, you will face ever-growing interest charges on your unpaid tax debt.

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Consumer advocates warn taxpayers to be cautious about hiring anyone who promises to be able to slash your tax debt, because many of those pitches are from scammers. Phillips agreed, saying, “Make sure you do your homework about who you’re dealing with.”

Who has to file a return?

The feds require anyone who earns more than a certain amount set by the IRS to file a return, even if they don’t owe anything. The amount varies according to filing status and age; for example, for 2023 it was $13,850 for a single filer under 65, or $15,700 for a single filer 65 or older.

The requirement applies regardless of your citizenship status. But if you don’t have a Social Security number — for example, if you’re in the United States on a temporary work visa or you’re here without authorization — you’ll need to obtain an Individual Taxpayer Identification Number.

Mandy Irvine, associate director of economic mobility for United Ways of California, said it’s a misconception that an ITIN is a sign that you’re in the country without authorization — ITINs are used by anyone who doesn’t qualify for a Social Security number. In addition, the law bars the IRS from sharing the information it collects from tax returns with Immigration and Customs Enforcement.

Through myfreetaxes.org, the United Way connects people with IRS-certified volunteers to help them prepare and file their returns. If you need an ITIN, Irvine said, look for a volunteer site that has a certified acceptance agent who can check your passport or other documents to verify your identity. That way, she said, you won’t have to mail them to the IRS.

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Where can I get last-minute help from the IRS?

The following Federal Taxpayer Assistance Centers will be open Saturday from 9 a.m. to 4 p.m.:

  • 300 N. Los Angeles St., Los Angeles, CA 90012
  • 501 W. Ocean Blvd., Long Beach, CA 90802
  • 880 Front St., Suite 1247, San Diego, CA 92101
  • 212 Coffee Road Suite 200, Bakersfield, CA 93309
  • 2525 Capitol St., Fresno, CA 93721
  • 1301 Clay St., Oakland, CA 94612
  • 450 Golden Gate Ave., San Francisco, CA 94102
  • 55 S. Market St., Suite 100, San Jose, CA 95113
  • 4330 Watt Ave., Sacramento, CA 95821

The agency stressed that although IRS employees will be on hand to offer in-person help with questions and account issues, they will not prepare your taxes for you. It also suggested that you come equipped with two forms of identification (including a current government-issued photo ID), the Social Security or Taxpayer Identification numbers for everyone in your household, and any notices or mailings the IRS has sent you.

If you have a question about a tax return you’ve already filed, make sure to bring a copy with you.

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Tesla to cut 601 jobs in Bay Area, a sign of more problems for EV maker

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Tesla to cut 601 jobs in Bay Area, a sign of more problems for EV maker

In the fourth straight week of layoff announcements, Tesla said it is now concentrating on reducing staff at its Bay Area facilities as part of a larger move to cut jobs globally.

State filings show that Tesla is planning to lay off 378 employees at its Fremont facilities and 233 at its Palo Alto offices.

The layoffs will occur over a 14-day period starting June 20.

An email to Tesla officials requesting comment was not immediately returned.

The layoffs come as the company struggles with flagging sales, top executives fleeing, a declining stock price and quality problems with the new Cybertruck. The low-cost Model 2 recently promised by Chief Executive Elon Musk also appears to be dead.

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It is not immediately clear which positions are being cut. The San Francisco Chronicle reported they would include technicians, electricians, software engineers, plumbers and athletic trainers.

On April 15, Musk announced in an email to staff that Tesla was cutting more than 10% of its workforce, citing job overlap and the need to reduce costs.

A week later, Telsa said it was laying off 3,332 workers at its facilities and offices in Fremont, Palo Alto, Burbank and Lathrop.

Including the latest cuts, Telsa has announced 3,933 layoffs this year in California.

“As we prepare the company for our next phase of growth, it is extremely important to look at every aspect of the company for cost reductions and increasing productivity,” Musk wrote in the April email.

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“As part of this effort, we have done a thorough review of the organization and made the difficult decision to reduce our headcount by more than 10% globally,” he continued. “There is nothing I hate more, but it must be done.”

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ChatGPT's new voice mode is giving 'Her' vibes

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ChatGPT's new voice mode is giving 'Her' vibes

The days of an interactive, almost-human virtual assistant could be coming sooner than you think.

Tech company OpenAI has unveiled the latest update to ChatGPT, which now includes a voice mode that allows users to communicate more conversationally with the AI system. In a video posted Monday on X by OpenAI Chief Executive Sam Altman, company officials ask ChatGPT to tell them a bedtime story involving robots and romance.

“Ooh, a bedtime story about robots and love?” ChatGPT responds in a cheerful female voice. “I’ve got you covered!”

The system proceeds to tell a story about a curious robot “in a world not too different from ours,” and then pivots to different voices when company officials periodically interrupt to ask it to speak more dramatically, in a robot-like voice or in a sing-song way.

The new update, known as GPT-4o, quickly received comparisons to the 2013 Spike Jonze movie “Her,” starring Joaquin Phoenix, in which a lonely man falls in love with his virtual assistant Samantha, voiced by Scarlett Johansson. Even Altman appeared to refer back to the film, saying in a blog post that it “feels like AI from the movies; and it’s still a bit surprising to me that it’s real.”

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(But that movie isn’t entirely rosy about AI taking on the role of a human companion, cautioned Wired Executive Editor Brian Barrett in a column titled “I Am Once Again Asking Our Tech Overlords to Watch the Whole Movie.” In the column, Barrett notes that at least one OpenAI employee heeded that advice. He quoted a tweet in which the employee said that re-watching “Her” “felt a lot like rewatching Contagion in Feb 2020.” )

“Getting to human-level response times and expressiveness turns out to be a big change,” Altman wrote.

Previous versions of ChatGPT were text-based, with users typing questions to the system and receiving written responses instantly. Past attempts to make the system give more human-like responses, beyond simple fact regurgitation or rudimentary stories, were largely rebuffed by ChatGPT.

Though bedtime tales about robots and love seem benign, AI and its potential effect on jobs is a pressure point in Hollywood and played a major role in last summer’s dual strikes led by the Writers Guild of America and the Screen Actors Guild-American Federation of Television and Radio Artists.

OpenAI, in particular, has not been shy about courting the entertainment industry and has met with studio and talent agency executives to discuss another of its products, Sora, an AI tool that uses text-based prompts and turns them into visuals that can be cinematic in quality.

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Recently, indie pop artist Washed Out used Sora, which is not yet publicly available, to create a four-minute music video for the song “The Hardest Part.” The music video zooms through scenes from a couple’s life that are completely AI-generated.

Beyond Hollywood, other industries are also flirting with AI, such as fast food operators. Those businesses are now looking to AI to run drive-through orders or walk-up self-service kiosks to reduce the financial effect of California’s new $20 minimum wage for restaurant workers in certain establishments.

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Pro-Palestinian activists protest at Google developer conference amid Israel-Hamas war

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Pro-Palestinian activists protest at Google developer conference amid Israel-Hamas war

Dozens of protesters blocked the entrance of Google’s developer conference in Mountain View, Calif., for roughly 90 minutes on Tuesday, demanding that the tech giant drop its work with the Israeli government amid the country’s war with Hamas in the Gaza Strip.

The protest group, which accuses Israel of committing genocide against Palestinians in Gaza, held two events on Tuesday that it said involved hundreds of participants.

A group chanted “Shame on Google” and “Google Cloud rains blood” in the front of the entrance to the conference at Shoreline Amphitheatre, where the tech giant was expected to announce updates to business including its Android and Gemini AI systems. Separately, the protesters held a rally at a nearby park.

The protesters, who call themselves No Tech for Genocide, have been demanding that Google end its cloud computing contract with the Israeli government, known as Project Nimbus.

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The latest Israel-Hamas war began when Hamas militants attacked southern Israel on Oct. 7, killing about 1,200 people and taking an additional 250 hostage, according to the Israeli government. Palestinian militants still hold about 100 captives, and Israel’s military has killed more than 35,000 people in Gaza, according to Gaza’s Health Ministry, which doesn’t distinguish between civilians and combatants.

Protesters at the Google event said they believe the company’s technology is being used by the Israeli military for surveillance of people in Gaza through facial recognition, leading to the arrest and detention of Palestinians.

Google did not immediately respond to a request for comment.

The company has said that its technology is used to support numerous governments around the world, including Israel’s, and that the Nimbus contract is for work running on its commercial cloud network, with the Israeli government ministries agreeing to comply with Google’s terms of service and acceptable use policy.

“This work is not directed at highly sensitive, classified, or military workloads relevant to weapons or intelligence services,” Google said in an April statement.

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One of the protesters at the Tuesday conference was Ariel Koren, a former Google employee who alleges the company retaliated against her in 2021 after she raised concerns about the contract. Google said at the time that it had investigated the case and found no evidence of retaliation.

“We want to make sure that every single person who comes here and who might think that today’s a day about celebrating technological advancements — every single one of those people needs to understand that the reality is much darker than what Google has painted,” Koren said.

Organizers estimated that 50 people participated in the demonstration in front of the conference. The rally at the park drew a bigger crowd.

One of the participants objected to Google holding its conference the day before Palestinians commemorate 76 years since their mass expulsion from what is now Israel. Palestinians refer to their displacement during the 1948 Israeli-Arab war as the Nakba, which is Arabic for catastrophe.

The protest in front of the Google I/O conference began at around 9:30 a.m., with protesters moving toward a bag checkpoint. Conference attendees had been asked to take out their laptops and have their bags searched.

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The event’s security closed the entrance as protesters moved to stand in front, leaving a large line of attendees who were later directed to another area to proceed to the conference. A line of protesters held a red sign that proclaimed “Google Stop Fueling Genocide.” The demonstration ended at about 11 a.m.

Google’s developer conference draws thousands of people each year, many of whom are developers eager to learn about the company’s latest technology.

After witnessing the protest, several attendees said they planned to do more research on Project Nimbus.

“I feel that it is worth a shot to listen to others when they have a point of view,” said Andres Haro, a 30-year-old software security engineer from Utah, as he waited in a long redirected line into Google I/O’s entrance.

The protest comes after more than 50 Google employees were fired following sit-ins and protests that took place at Google office locations last month protesting Project Nimbus. Google said it terminated those workers after an investigation determined they were involved in disruptive activity that violated its policies governing employee conduct.

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A spokesperson for the group behind the sit-ins, called No Tech for Apartheid, said they were not involved with Tuesday’s protest.

“We’re asking more questions about what role we and our employers are playing in the world,” said Roni Zeiger, a product developer who participated in the rally on Tuesday at Charleston Park, near the Google event. “World events have continued to evolve and … people, including employees, are asking harder questions and wanting to work at places that are consistent with their values.”

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