Tax Tips |
Tax Tip
Overview
- Filing a late return will subject you to a penalty of 5% per month on any unpaid balance.
- Use Form 4868 to apply for an extension to file.
- An extension doesn't extend your time to pay. If you don't pay at least 90% of the tax by April 15, a 0.5% per month late-payment penalty will apply to any unpaid balance for up to 50 months.
- Get an automatic 2-month extension if you reside outside the U.S. during filing time.
Why file an extension?
Without a valid extension, a late-filed return is subject to a 5% per month penalty on any unpaid balance. The combined penalties for late-filing and late-payment can be as much as 47.5% (see below) of the unpaid tax.Filing Extension
File Form 4868 to automatically extend your filing deadline 6 months to Oct. 15.Payment Required
An extension of time to file is not an extension of time to pay. When you file your extension request, estimate any balance due and pay as much of it as you can. If you file an extension and have paid at least 90% of the tax by April 15, the late-payment penalty does not apply. Interest will be charged on any unpaid balance.If you don't file your return by Oct. 15, both the late-filing and late-payment penalties apply. If both penalties apply, a penalty of up to 25% of the balance due will be charged in the first 5 months. The 0.5% failure to pay penalty will continue to apply for up to 45 more months. Note: Interest on the unpaid balance and accrued penalty will continue to be charged until the balance due is paid.
Individuals Outside the U.S.
If you reside outside of the U.S. on April 15, you have an automatic 2-month extension until June 15 to file. You don't need to request this extension or submit any forms. If you need more time than this, file Form 4868 by June 15 to get an additional 4-month extension to Oct. 15. Note: You are not entitled to the automatic 2-month extension if you are merely taking a vacation or are on a business trip outside of the U.S.People Who Read This Also Read
Frequently Asked Questions
Question: When I file an extension do I have to pay what I owe at that time?
Answer: An extension allows you to file your return after the normal due date, but does not extend the time for paying tax that you may owe. You report the estimated amount of your income and tax liability and the amount of tax you have already paid on Form 4868 - Request for Extension. If, by April 15, you've paid at least 90% of your actual tax, you won't be subject to the failure to pay penalty, but you'll owe interest on any balance due. If you haven't paid at least 90% of your actual tax, you'll owe both the failure to pay penalty and interest.
Question: If I'm getting a refund from my state return, do I need to file an extension?
Answer: The requirements vary by state. Some states require an extension only if you do not request a federal extension. Others require an extension even if you request a federal extension. A few states do not have any provision for extensions. In addition, some states impose a late-filing penalty even if a refund is due. Contact your local H&R Block tax professional if you have questions.
Question: I'm filing an extension. How can I avoid the penalty for late filing?
Answer: If at least 90% of the current year's tax shown on your return is paid by April 15 through withholding, estimated tax payments, or with Form 4868, you will avoid the penalty for late payment. Interest will be charged on any balance due from the regular due date of the return.
More Extension FAQs
Answer: An extension allows you to file your return after the normal due date, but does not extend the time for paying tax that you may owe. You report the estimated amount of your income and tax liability and the amount of tax you have already paid on Form 4868 - Request for Extension. If, by April 15, you've paid at least 90% of your actual tax, you won't be subject to the failure to pay penalty, but you'll owe interest on any balance due. If you haven't paid at least 90% of your actual tax, you'll owe both the failure to pay penalty and interest.
Question: If I'm getting a refund from my state return, do I need to file an extension?
Answer: The requirements vary by state. Some states require an extension only if you do not request a federal extension. Others require an extension even if you request a federal extension. A few states do not have any provision for extensions. In addition, some states impose a late-filing penalty even if a refund is due. Contact your local H&R Block tax professional if you have questions.
Question: I'm filing an extension. How can I avoid the penalty for late filing?
Answer: If at least 90% of the current year's tax shown on your return is paid by April 15 through withholding, estimated tax payments, or with Form 4868, you will avoid the penalty for late payment. Interest will be charged on any balance due from the regular due date of the return.
More Extension FAQs
Related IRS Forms & Publications
- Form 4868 - Application for Automatic Extension of Time to File U.S. Individual Income Tax Return
- Form 4868 (SP) - Application for Automatic Extension of Time to File U.S. Individual Income Tax Return (Spanish version)
- Form 1127 - Application for Extension of Time for Payment of Tax
- Form 2350 - Application for Extension of Time to File U.S. Income Tax Return
- Form 2758 - Application for Extension of Time to File Certain Excise, Income, Information, and Other Returns
- Form 4768 - Application for Extension of Time to File a Return and/or Pay U.S. Estate (and Generation-Skipping Transfer) Taxes
- Form 4768 Instructions
- Form 5558 - Application for Extension of Time to File Certain Employee Plan Returns
- Form 7004 - Application for Automatic Extension of Time to File Corporation Income Tax Return
- Form 8809 - Request for Extension of Time to File Information Returns
- Form 8868 - Application for Extension of Time to File an Exempt Organization Return
- Form 8878 - IRS e-file Signature Authorization-Application for Extension of Time to File
- Form 8878 (SP) - IRS e-file Signature Authorization-Application for Extension of Time to File (Spanish version)
- Form 8892 - Payment of Gift/GST Tax and/or Application for Extension of Time to File Form 709
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