Understanding the Extended Federal Income Tax Return Filing Deadline
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The article "Navigating Tax Return Deadlines: A Guide for Individuals and Businesses" discusses the initial tax return filing deadlines and the consequences of filing late. In this article, we will explain the extended filing deadlines.
Around ten to fifteen percent of taxpayers extend the filing of their federal tax returns to ensure they have all the necessary information to file their federal income tax returns.
The IRS does not penalize you for asking for a filing extension. Asking to extend the deadline for filing the tax return gives more time to gather the necessary information and prepare the tax return without a late filing penalty. However, the late filing penalty will be assessed if you do not request a filing extension or do not file your income tax return by the extension deadline.
It is important to understand that a filing extension does not extend the taxpayers’ obligation to pay the taxes. Thus, you will incur interest charges and late payment penalties on the amount of tax you fail to pay by the payment deadline. For individuals, the payment deadline is April 15.
To request an extension to file an income tax return, individual taxpayers and businesses can request an automatic filing extension, which has to be filed by the initial deadline for filing the tax return. The automatic filing extension gives an additional six months from the initial deadline to file the income tax returns.
Therefore, if the initial tax return filing date for individuals falls on April 15th, the extended due date for the tax return becomes October 15. Similarly, for businesses organized as C corporations that use a calendar year, the extended filing deadline would usually fall on October 15. For businesses organized as S corporations and partnerships, the extended income tax return is usually due by September 15. It is important to note that if the extended deadline falls on a weekend or holiday, the due date is moved to the next business day.
Special deadline if you are outside of the United States. For U.S. taxpayers who find themselves outside the U.S. on the tax filing deadline, a two-month extension is available. To qualify for an extension, your principal place of business must typically be outside the United States, or you must be on active duty in the military.
To take advantage of this extension, simply file your return no more than two months after the original due date and attach a statement explaining why you qualify for the two-month extension. However, interest will still be charged on payments made after the regular due date, regardless of the extension.
Should you ask for a filing extension? In addition to avoiding late filing penalties and having additional time to prepare your tax return, a filing extension may help you to save on tax preparation fees. Since only 10-15% of taxpayers utilize the extended filing deadlines, the tax return preparers are less busy during extended filing periods and, thus, may agree to knock down their tax return preparation fee.
One downside of filing for an extension is that it delays your refund. In order to receive a refund, you must file your federal income tax return. Therefore, by filing your tax return six months later, you postpone receiving the money you're owed from the IRS. Additionally, you may require your most recent income tax return for purposes such as applying for a personal or business loan, a mortgage, or government assistance. If delaying the filing of your tax return will cause a delay for important applications or other essential matters, it might be best to proceed and file your return now.
Olena Ruth | Tax Defense Attorney
Olena represents the taxpayers in federal and state tax audits, collection matters, administrative appeals, and the U.S. Tax Court’s cases. She is actively engaged in Tax Sections of the American Bar Association and Colorado Bar Association. She serves as Colorado Bar Association’s pro-bono attorney and liaison to the Internal Revenue Service. Her speaking engagements include presentations on tax matters in family law, employment tax issues, and communication with the IRS.
Olena can be reached at olena@ruthtaxlaw.com
