So it is time to file your tax return…Do you need more time to prepare your federal tax return? There is great news for you! The IRS allows individuals, businesses and estates to file a tax return after the deadline by obtaining an extension. Simply put, a tax extension gives you six extra months to do your taxes. In a normal tax year without IRS exceptions, this would mean pushing your filing deadline from March 15th to September 15th and your personal filing deadline from April 15th to October 15th. Successfully filing for an extension means no late-filing penalty will be assessed unless the return is not filed by the extended deadline.
I know what you are thinking…an extension? Isn’t this bad? No, not at all! Sometimes filing an extension is needed to give you or your tax preparer some extra time. You may only need a few extra days or weeks, but filing an extension will ensure you don’t have any late penalties.
Please be aware that:
- An extension of time to file your return does not grant you any extension of time to pay your taxes.
- You should estimate and pay any owed taxes by your regular deadline to help avoid possible penalties.
- You must file your extension request no later than the regular due date of your return.
So now that you know WHAT an extension is, ask yourself: Is an extension the right thing for me or my business? Here are some things to consider:
Pros
- Reduce late penalties
- Preserve your tax refund
- Fund a self-employed retirement plan
- Take extra time to make elections
Cons
- You will not gain extra time to fund or be able to recharacterize IRA contributions
- You can’t switch from married filing jointly to separately after April 15
If this is the right thing for you, it is very easy to file. Just let us know and we can file it for you. If you would rather do it yourself, you’ll need to fill out IRS Form 4868, then mail in your form or file it electronically using the IRS e-file. To get an extension without the form, you can pay all (or part) of your estimated income taxes online. You’ll get an automatic extension just by paying, but you do have to fill out your return eventually.
For more information or questions please ask your Tax Advisor!
Sources:
https://www.irs.gov/forms-pubs/extension-of-time-to-file-your-tax-return