If you don't file your tax return by the due date and assuming that you money, you would be hit with two penalties: failure to file and failure to pay.

The failure-to-file penalty is equal to 5% of the taxes you owe for each part of a month you're late, up to a maximum of 25% of unpaid taxes. Therefore, this penalty reaches its maximum after a 5-month filing delay. For example, if you're two days late with filing and you owe $1,000 in taxes, you could be hit with a $50 penalty. If you're more than 6 months late, the maximum penalty is $250.

The failure-to-pay penalty is 0.5% of unpaid taxes for each part of a month you're late, up to 25% of unpaid taxes due. This penalty applies even if you file on time but don't pay what you owe. This penalty reaches its maximum after a 50-month delay in payment. For example, if you're two days late with paying and you owe $1,000 in taxes, you could be hit with a $5 penalty (10 times less than the failure to file penalty).

A quick glance at these penalties shows why it's so important that you file your taxes on time, even if you can't pay on time. In most cases, the failure-to-file penalty is 10 times greater than the failure-to-pay penalty.

Most people believe that the Government wants your tax dollars, whereas it seems that it wants your tax return much more than your money. Why is that?