Tax Extensions: What You Need to Know
If you can't file your tax return by the deadline, you can request an extension. However, it's important to understand what an extension does and doesn't do.
What an Extension Does
A tax extension gives you an additional six months to file your tax return. For most taxpayers, this extends the deadline from April 15 to October 15.
What an Extension Doesn't Do
An extension does NOT extend the time to pay your taxes. You must still estimate and pay any taxes owed by the original deadline (April 15) to avoid penalties and interest.
How to Request an Extension
You can request an extension by:
- Filing Form 4868 electronically
- Using tax software to file an extension
- Having your tax preparer file it for you
Penalties for Not Paying
If you don't pay your estimated tax by the original deadline, you may face:
- Failure-to-pay penalty: 0.5% per month of unpaid tax (up to 25%)
- Interest: Currently around 8% annually, compounded daily
When Extensions Make Sense
- You're waiting for important tax documents
- You need more time to gather documentation
- You're dealing with a complex tax situation
- You're working with a tax professional who needs more time
Estimated Tax Payments
When requesting an extension, you should estimate your tax liability and pay as much as possible by the original deadline. This minimizes penalties and interest.
Our tax professionals can help you estimate your tax liability, file an extension, and ensure you meet all deadlines to avoid penalties.