DID YOU GET A TAX RETURN EXTENSION: Here Are the Rules for Extensions

We all know that tax returns are due each year on April 15 (March 15 for certain business tax returns).?But what do you do if you are not ready to file your tax return by the deadline??You should request an extension to file your tax return.

An extension extends the deadline to file your tax return to October 15 (September 15 for certain business tax returns).?Requesting an extension to file your tax return does not increase your chance of being audited, but it does allow you additional time to gather the information you need to file a complete and accurate tax return.

You’ll notice that I keep repeating the phrase “…an extension to file your tax return”.?That’s because an extension gives you more time to “file” your tax return but doesn’t extend the date to “pay” your tax.?Any taxes you may owe with your tax return must be paid by the original due date or you will owe interest and penalties on your late payment.

Every year we must explain this quirky rule to clients who know they owe money with their tax return and think they can extend the payment until October 15.

I’m sure you’re asking yourself, “How do I know how much to pay if I haven’t completed my tax return?” ?You need to estimate how much your ultimate payment is going to be and send the payment with your extension request.?If you over-estimate your tax liability and send too much with your extension request, the excess money can be refunded when you file your tax return.

For taxpayers with complex tax returns, calculating an extension tax payment can be a time-consuming process and may increase the amount they pay their tax return preparer.

So, why am I writing an article about tax return filing requirements during the summer??Because many tax return preparers take time off each year from filing tax returns, after April 15, to catch-up on work that was postponed during the busy tax season.?Tax return preparers then resume filing “extended” tax returns in June or July each year.

If your tax return was extended, and hasn’t been filed yet, expect to hear from your tax preparer in the very near future.

If you need help filing your extended tax return, contact ARI today.?We have resumed working on tax returns.