File a Federal Tax Extension

In this article you will learn what a Federal Tax extension is, who can benefit, when to file an extension, and how to file an extension.

What is a Federal Tax Extension?

A federal tax extension is when the IRS gives you an additional 6 months to file your taxes. Keep in mind this only gives you additional time to file, not pay. If you expect to have a balance, you should estimate and pay any owed taxes by your regular deadline to help avoid possible penalties. More on this is explained below.

Even though the due date is the same across the US, there are some exceptions as described below.

If you are serving in a combat zone or Active duty outside the US or Puerto Rico, you may qualify for an Automatic 2 Month Extension making your due date June 15 (depending on the tax year), without having to file form 4868. However, you might want to file form 4868 to get an additional 4 months.

When to file

As of the date of this writing, the tax filing deadline is April 18, 2023 but one can request a Federal Tax Extension which will provide an additional 6 months to file your return. The IRS understands that life happens and there are many reasons why you may not have been able to file your taxes. Perhaps you were so busy making money that you forgot to schedule an appointment with your tax preparer, or you were not organized enough to gather all the necessary documents. Whatever the reason, you are able to request a Federal Tax Extension on or before the deadline of April 18, 2023. Luckily, we dont need to explain the reason for the extension unless the IRS declines the original request which is unlikely.

Who can benefit from Filing a Federal Tax Extension

Any individual that has earned income or taxable income in the US can benefit from filing a Federal Tax Extension. The IRS will charge you interest and penalties if you dont file a tax return on time.

• Interest

Interest will be charged on any amount due until the amount is paid in full, even if you file a Federal Tax Extension. Thats why it is very important to send payment if you expect to have a balance.

• The late payment penalty

The late payment penalty is usually of 1% of any tax (other than the estimated tax) not paid by the regular due date of your return which is April 18, 2023. Requesting a federal tax extension can help you avoid late filing penalties if you pay any tax due when you send the extension.

• Failure to file penalty.

The failure to file penalty is based on how late the return is and the amount of unpaid tax. The penalty is usually 5% of the amount due for each month or part of the month your return is late. The maximum penalty is 25%.

If you anticipate owing taxes, send a full or partial payment to the IRS with Form 4868. You can send an electronic payment on the IRS Website. Alternatively, you can pay with a check or money order. When paying by check or money order with Form 4868, use the appropriate address in the middle column under Where To File a Paper Form 4868. If you would like to e file your extension, we can help!

How to file a Federal Tax Extension

Now that you know that there is a way to get an extension, how do you do it? One option is for you to fill out form Form 4868 and mail it . With technology changing and to make life easier, the IRS prefers for you to e-file (electronic file). We are able to assist you on filing a Federal Tax Extension here in just a few minutes. Let it be clear that Form 4868 is only for individuals filling a regular 1040 return which applies to most taxpayers. If you need to file a federal tax extension for business use Form 7004 which includes partnerships and multiple-member LLCs, S corporations, and C corporations. Filing an extension for a business has different implications not covered in this article.

Even though filling a Federal Tax Extension allows you to file your Taxes by October 17 ,2023, the IRS encourages you to file before if possible. Additionally, when you are ready to file your return, you dont need to include Form 4868 that was filed. However, be sure to account for any payments that you made when you file Form 4868.

We understand that tax filing can be intimidating and a bit confusing. We are here to help and we understand that the information provided above is consistent with most taxpayers, but that there are always unique situations. Remember that we are here to assist you. Feel free to Contact Us with any questions regarding your Federal Tax Extension.