The Internal Revenue Service (IRS) said it is opening up the opportunity for people to apply for tax return extensions through Oct. 15, regardless of the taxpayer’s reason for the extension, to ensure taxpayers have more time to review their tax returns.
This Monday, May 17, is the official deadline for individuals to file their federal tax returns for 2020, as well as the deadline for most Americans to file their state taxes. If you haven’t filed yet and feel pressed for time, don’t panic. You may want to consider filing an extension.
Whether your reason for extending your tax return is a lost tax document, a family emergency, or a lost track of time, the Internal Revenue Service (IRS) is opening the door for people to request an extension until October 15 to ensure that taxpayers have more time to review their tax returns and learn about all available tax benefits.
But there are a few things to remember. If you are filing for an extension when you owe taxes, the extended time can only be used to file a tax return, not to delay payment, and taxpayers will still have to pay their taxes by the end of the tax filing deadline. If taxes are not paid by May 17, the IRS will charge interest on the unpaid tax amount. According to TurboTax, the penalty for failure to file can increase to 25% of the tax due.
The following are instructions for filing an extension of time to file a tax return.
- How do I file an extension?
To request an extension, taxpayers can electronically file the Application for Automatic Extension of Time to File U.S. Individual Income Tax (Form 4868) with the IRS on the May 17 tax filing deadline. Or you can file using the free file software provided by the major tax preparation companies.
Another option is to print out the form and mail it to your state’s IRS address by the end of the deadline.
It’s important to note that even if you file an extension, you still have until May 17 to pay your taxes. If you underpay your taxes, you may end up paying interest on the underpayment to the extent that you owe taxes.
- How do I apply for a state tax extension?
The rules vary from state to state, and each state has its own rules for filing tax extensions. You can “click here” to check your state’s tax agency website for more information.
- What happens if I can’t pay my taxes?
According to the IRS, taxpayers may be eligible to use an online payment plan or an installment agreement to add time to pay off the outstanding balance. Even if you have a previously established payment plan, you can still change plans to modify an existing payment agreement.
- When will I get my tax refund?
According to the regulations, taxpayers must submit a tax refund form and have it processed by the IRS before receiving the refund.
- What should I do if I live abroad?
If you are a U.S. citizen or a permanent resident of the U.S. and live and work outside the U.S. and Puerto Rico, for example, you will automatically be given an additional 2 months, through June 15, to file your federal tax return. Although such taxpayers are not required to file Form 4868 to obtain the extension, a statement explaining why you qualify for the later deadline must be filed.
Alternatively, if you cannot file your tax return by the two-month automatic extension date, you may file a Form 4868 requesting another extension until October 15. You have until June 15 to file this form.
Remember, the above taxpayers still need to pay their taxes by the end of May 17 or pay interest on the unpaid taxes.
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