When you see flowers blooming, the air is rich will pollen and allergens; you can be sure that spring is in the air and this also means taxes are due. It is usually surprising how time flies without our consciousness. As the time to pay up taxes are getting nearer, people start to wonder if they should consider filing a tax extension in order to buy themselves more time to file. You should always make sure you consult a tax professional before you take any steps regarding this situation. But for the sake of getting the conversation started, let’s look at some of the facts surrounding tax extensions:
According to the IRS ( www.IRS.gov ), there are a couple ways a filer can request an extension. Taxpayers can use IRS Free File to not only file their taxes for free, but also request an extension. While you have until April 15th, 2019 to file an extension for your 2018 taxes, if you know you are not going to make it by the deadline, it is best to not wait until the last minute. There is always the possibility of technical issues, so why add stress to an already potentially stressful situation?
To request for tax extension, either you or your tax preparer can e-file form 4868 to request for the extension or mail the form in if that is what you prefer. You can potentially extend your filing for up to 6 months tax extension from the filing deadline if successful according to form 4868 which you can have access to on www.irs.gov. in order to qualify for the extension, you must;
- Properly estimate your 2018 tax liability using the information available to you
- Enter your total tax liability on line 4 of Form 4868
- File Form 4868 by the regular due date of your return
Also included on form 4868 is the following important information that possible tax extenders should heed:
“Although you aren’t required to make a payment of the tax you estimate as due, Form 4868 does not extend the time to pay taxes. If you don’t pay the amount due by the regular due date, you’ll owe interest. You may also be charged penalties. For more details, see Interest and Late Payment Penalty on page 2. Any remittance you make with your application for extension will be treated as a payment of tax. You don’t have to explain why you’re asking for the extension. We’ll contact you only if your request is denied. Don’t file Form 4868 if you want the IRS to figure your tax or you’re under a court order to file your return by the regular due date.”
You should be aware that as much as you can extend the filing of your taxes, this does not mean you can extend the time to pay up your tax. During this time, it is possible penalties and interest may be added to your tax which leaves you to owe the IRS more than before.
If you are living outside the US or are serving in the military in a combat zone and you are filing for a tax extension, special rules may apply. If you have special circumstances or concerns or need more assistance in determining how to file an extension or whether it is right for you, you can contact a tax professional or even try calling the IRS directly. Wait times may be even longer than the standard long wait times during tax seasons.
Some people who need some extra time to sort through their information or situation have the advantage when you request for tax extension. If there are extenuating circumstances that are prohibiting you from filing on time, asking for an extension may be a good way to avoid extra penalties and fees and help keep yourself on the right side of your taxes. However, if you are looking to avoid paying taxes for the time being or are looking to make additional interest on the money you have saved, guess again. There is a possibility of it becoming more of a headache to go through the extension process than just bite the bullet and get it done of you continue to procrastinate the inevitable.