How to File a Tax Extension
April 14, 2010
I’ve filed a tax extension before; it’s easy to do and makes sense if you don’t have all the information you need to completely fill out your tax return. Keep in mind that although a tax extension lets you delay filing your tax return you still have to pay the money you owe the IRS by April 15th or you could face fees and interest.
Estimating Your Taxes
If you tax situation is similar to the previous year you could use your tax bill from last tax year as a starting point to estimate your taxes. If it were me, I’d estimate high because I’d rather overpay and get some of the money back than risk paying too little and ending up owing interest on my unpaid taxes.
Typically you don’t want to overpay your taxes throughout the year because you’re giving the government an interest free loan for almost 12 months but in this case the time period between when you file your extension and you actually send in your tax return is likely much shorter.
If you use Form 4868 that we’ll cover in a second, the extension does give you another 6 months to file so if you do overpay, don’t wait until October 15th to file your taxes.
Tax Estimate Calculator
Another way of estimating your taxes due is to use a tax estimate calculator like TaxCaster from TurboTax. Tools like this ask you to fill in information about your income, tax deductions & credits, and any tax payments. Then they come up with an estimated amount of federal taxes due.
In order to file a tax extension for your personal tax return you fill out form 4868, an Application for Automatic Extension of Time to File U.S. Income Tax Return.
As I mentioned earlier, I’ve filed for an tax extension before, there’s not much to it. After you fill out form 4868 you can either mail it in or you can e-file. This gives you a 6 month extension, which means you need to have your tax return filed by October 15th. Resist the urge to put off filing until next October because it will be here before you know it and you don’t want to find yourself scrambling up against another tax deadline.
All posts by Ben Edwards