April 15 looms on the horizon. There may be any number of reasons that you are not prepared to file a tax return, from not having your dividend statements back, to waiting to get a home buyer tax credit, to straightforward procrastination. No matter your reasons, you can actually file for an extension. Any taxpayer is eligible to get a six month extension for filing a tax return. You have to file for the extension by April 15, and then you will have until October 15 to get your documentation together and file your actual return.
Filing an extension is a good idea if you don’t think you’ll be able to get your return together by April 15. The penalty for a “failure to file” can be quite hefty. As long as you file your extension paperwork — it’s only on page! — by April 15, you can avoid this penalty.
Be warned, though, that filing for an extension doesn’t get you another six months to actually pay your taxes. You are required to estimate how much you owe, and submit payment by April 15. The IRS starts charging interest from April 16, so it’s a good idea to pay something. Any tax refund you are entitled to will, as you might have guessed, be mailed to you after you file your return in October.
It is fairly easy to file a tax extension these days. You just need to fill out Form 4868.
If you use tax preparation software, like Tax Cut or TurboTax, it’s easy to file your tax extension. These programs have the appropriate forms, and the ability to allow you to send in the form electronically, or print out your completed form and then mail it in. If you have a professional prepare your taxes, he or she can usually file your tax extension electronically on your behalf.
Even without tax preparation software, you can still file your Form 4868 electronically using the fillable forms from the IRS. Just fill in your form online, and then submit it using approved methods directly from the IRS web site. In many cases, it is free to file your federal tax extension, and it only takes a few minutes.
If you are more old school, it is possible to file for a tax extension using paper methods. Many post offices, community government buildings and libraries offer tax form packets, and you can pick them up for free. Additionally, you can download Form 4868 and then fill it out and mail it in. You can also obtain the proper form by calling 1-800-TAX-FORM (829-3676).
The nice thing about filing a tax extension is that it doesn’t prevent you from filing your return electronically. In six months, when you are ready to file your tax return, you can do so over the Internet. This is a definite step above filing an amended return, which can only be done via paper. This can cause delays in processing and receiving your refund. With an electronically filed extension and return, you will get your refund — if you have one coming — faster.
Once your tax extension is filed, the clock is ticking until October 15. If you have been procrastinating, now is the time to get into gear and start doing what you can to get your documentation together.