As of March 14, only 70.4 million filings had been submitted; at that point last year, the IRS had received close to 71.6 million returns.
The survey of more than 1,000 Americans found that the top reasons that people delay filing taxes include the complication and stress of dealing with tax forms, apprehension about making mistakes, and irritation with what can often be a very time-consuming process.
“When it comes to the process of filing, 44 percent file their taxes on their own, while 55 percent get help which can include using online services, an accountant or tax preparer, or asking a friend or family member,” the report states. “Among those who are business owners, 29 percent say they struggle with filing taxes for the business.”
Experts also cited waiting for tax code changes as one reason for the delay.
Arron Bennett, founder and CEO of Bennett Financials, based in Knoxville, Tennessee, told The Epoch Times that the company is recommending applying for extensions for many of their clients.
“We’re waiting to see if President Donald Trump is going to make any changes to the tax code that could save money for both individuals and business owners,” he said.
Bennett specifically mentioned the possibility of the 40 percent bonus depreciation being restored to its former 100 percent rate.
Earlier this month, Trump discussed the bonus depreciation policy that allows businesses to deduct expenses for investments in assets such as equipment or enhancements. In addition, Trump is considering changes in depreciation policies for rental properties.
Other tax proposals by Trump include reducing the current 21 percent corporate tax rate to 15 percent, eliminating the estate tax, raising the $10,000 cap on deductions for state and local taxes, and eliminating taxes on Social Security benefits for seniors, tips, and overtime.
Besides waiting for any possible tax changes, Bennett noted that another reason for delayed filings this year could be an increase in independent contract workers.
“A lot of individuals who do contract work could also be waiting for their 1099 forms from clients” he said. “Payments from Venmo, Zelle, or other cash apps could be playing into the delay as well, as some people may be confused about whether they need to file this information. These platforms are also required to send 1099 statements.”
As more people work remotely and take on freelance jobs, they also have to worry about self-employment taxes, reporting business income, and making estimated payments to the IRS.
“This could also cause possible filing delays,” Bennett said.
Tom O’Saben, director of tax content and government relations for the National Association of Tax Professionals, agreed.
“It seems like every year, taxpayers are getting information later and later,” he told The Epoch Times. “People also may not be used to getting things electronically through emails or websites, and they are still waiting for something to be delivered by mail.”
O’Saben suggested that taxpayers who are waiting for additional information file for an extension but make sure to pay any estimated taxes by April 15.
“I also tell my clients to overestimate their payments to give themselves a cushion. It’s better to pay more than to pay less because that way they’ll get a refund instead of another tax bill,” he said.
As for new tax legislation, O’Saben is doubtful that it will happen for this tax season.
“If I were placing bets, I’d say that the new tax laws won’t be enacted until late summer at the earliest,” he said.
Weather-related disasters could also hinder people from filing their tax returns.
This year, in particular, millions of people across the United States were hit hard by weather-related disasters, from wildfires to flooding. As a result, the IRS is providing relief to California wildfire victims by delaying the tax filing deadline to Oct. 15.
“Qualified wildfire relief payments made to Los Angeles taxpayers affected by California wildfires that are not covered by insurance of other reimbursements are excluded from income, even if these payments are made by nonprofit organizations or other non-governmental entities,” the IRS stated.
Victims of severe weather in West Virginia and Kentucky have been granted a filing extension until Nov. 3. Taxpayers in the entire states of Alabama, Florida, Georgia, North Carolina, and South Carolina, as well as parts of Alaska, New Mexico, Tennessee, and Virginia, have until May 1 to file their returns.
As of mid-March, the IRS had processed 69.6 million returns, in contrast to 70.6 million returns filed by the same time last year. A total of 49.8 million refunds had been processed, and almost $163 billion had been refunded. The average refund amount is up this year, to $3,271 from $3,109 in 2024.
Penalties can include charges for an Information Return, for taxpayers who don’t file or provide information correctly by the due date, or for a failure to file or pay on time. Erroneous claims, bank checks with insufficient funds, or underestimated payments may also be subject to penalties. Those who cannot pay the full amount or penalty fees due may apply for a payment plan.
The IPX report found that for the third year in a row, Wyoming topped the list as the state that is home to the most tax procrastinators. Alaska ranked second, followed by Vermont, North Dakota, and Delaware. Conversely, the states with the most on-time tax filings include Wisconsin, Pennsylvania, Michigan, and Indiana.
Over the years, there has also been a recurring discussion of abolishing the current tax code and instituting a flat tax rate.
“I think it’s going to be very hard to make that happen,” Bennett said. “A lot of individuals and businesses are used to taking deductions, and while it could even out in the long run, it could be difficult to enact.”
He said instituting a flat tax could also be detrimental for many accounting firms specializing in tax preparation.
“It could change the landscape of some accounting and finance firms and could put them out of business if they don’t offer other services,” Bennett said.
