What you need to know about extended tax returns
Most people don’t know that the tax filing deadline isn’t set in stone. If you’re unable to file by April 18, you can apply for an extension. What you do need to keep in mind is that if you think that you’ll owe money to the IRS, you’ll still need to pay what you owe by the April 18 deadline. Again, while a tax extension allows you extra time to file your tax return, it does not give you extra time to pay your taxes. Below are just a few of the other things that you should know about extended tax returns.
How do I know if I’ll qualify?
Almost everyone who files form 4868 with the IRS will be given extra time to file an individual income tax return. This form can be filed electronically, and you don’t need to have a tax professional file it on your behalf. Or, if you prefer to mail it, you can print out a hard copy, fill it out, sign it, and drop it in the mail. If you do decide to send it via the USPS, be sure to send it via certified mail with a return receipt.
How much extra time will I get?
If you live in the United States and file for a tax extension, you’ll get an extra 6 months to file. If you currently live abroad and you’re unable to meet the June 15 tax filing deadline (which is automatically granted to people who live or work overseas), and you apply for a tax extension, the IRS will give you a 4-month extension. Consequently, the deadline to file for everyone who applies for it is October 15.
What happens if I owe taxes, but I don’t pay on time?
You’re not required to make a tax payment when you file for an extension, however, if you owe money to the IRS and you don’t pay on time, you may be charged late fees and penalties.
What happens if I file late but didn’t file for an extension?
If you file late without filing for an extension, you could face a financial penalty. According to the IRS, “A late filing penalty is usually charged if your return is filed after the due date (including extensions). The penalty is usually 5% of the amount due for each month or part of a month your return is late. The maximum penalty is 25%. If your return is more than 60 days late, the minimum penalty is $435 (adjusted for inflation) or the balance of the tax due on your return, whichever is smaller.”
Call our office today to speak with an expert for more information on how tax filing extensions work.