Understanding IRS Tax Extensions

When you were in school, did you ever have a big paper due that you knew you weren’t going to be able to finish by the deadline? Perhaps it was due to procrastination, perhaps you had an illness that slowed your productivity, or perhaps you simply wanted to perfect your work. Whatever the reason, you knew you would likely face penalties for turning the work in late, such as a lower grade, so what could you do to remedy the situation?

Under these circumstances, many people probably would reach out to their teacher and request an extension that would give them much needed time to complete the assignment. Did you know that it is possible to do the same with your taxes?

And whereas your teacher would probably require a very good excuse for your needing an extension, the IRS has much simpler requirements for granting you relief.

Any taxpayer is entitled to an automatic six-month extension beyond the traditional April 15th filing date simply by asking. If you want to request an extension on submitting your tax paperwork to the IRS, you must fill out and file Form 4868, the “Application for Automatic Extension of Time To File U.S. Individual Income Tax Return.”

Your application must be filed with the IRS by the due date for your calendar year income taxes, and it can be filed electronically or through the mail.

However, one very important aspect of the extension that you need to keep in mind is that Form 4868 only grants the taxpayer an extension on filing, but NOT on tax liability. You must still estimate your taxes as best you can and submit payment, otherwise you will incur penalties and rack up interest for unpaid taxes that will accumulate until your taxes are filed and paid.

Businesses can also utilize the automatic six month tax extension by filing Form 7004, the “Application for Automatic Extension of Time To File Certain Business Income Tax, Information, and Other Returns.”

An extension on filing your taxes can be a serious blessing for both procrastinators and those with other issues that have prevented them from completing their taxes by the filing deadline. Without the extension, if you do not file by the deadline, you will incur even more penalties than if you had simply failed to pay your taxes.

If you do not believe you will meet the regular tax deadline, let us know and we will take the necessary steps to file an extension.

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Written by Desnoyers CPA

Desnoyers CPA

Known for her friendly, outgoing nature and her rare talent for financial foresight, Lydia Desnoyers has been serving individuals and small businesses in Florida since 2010. After earning her Master’s Degree in Accounting from Nova Southeastern University and her Bachelor’s Degree in Accounting from Florida State University, she became a Certified Public Accountant and a Certified Fraud Examiner.