Need more time to file your tax return?
With Tax Day just days away, many individuals have come to the realization that they will not be able to file their taxes on time. Fortunately, the IRS allows extensions.
In 2012, more than 12 million individuals requested an automatic six-month extension. However, just because they have permission from the IRS to wait six months to file, does not mean they can wait six months to pay.
“People tend to worry that requesting an extension will make them more likely to be audited,” said Bruce Primeau, a certified public accountant (CPA) at Summit Wealth Advocates. “This is not the case. The IRS knows people have all sorts of legitimate reasons for needing more time. Those who wind up facing penalties are the ones who think they can wait to pay.”
Taxpayers who are not sure about their exact income because they are waiting for documentation from an employer or business partner must use their best judgment and pay what they think they owe.
“If you underpay, the IRS can come after you for penalties and interest,” Primeau said. “Ultimately, you don’t want to wait around. Make your best guess and send in the payment. That way, you won’t have to worry about the penalties and interest clock ticking on your whole tax bill.”
To those who haven’t filed in years and are now afraid to file, Primeau offers the following advice: “The longer you wait, the worse it’s going to be. Do your best to get your information together and go talk to a professional. Again, the clock for penalties and interest starts ticking the minute you don’t file. You want that clock stopped. There are payment plans available if you can’t pay what you owe all at once.”
A CPA can help individuals file for a tax extension and complete the various other aspects of filing taxes.
To connect with a CPA, visit CPAmeASAP.com.
TIPS FOR FILING
The Minnesota Society of Certified Public Accountants has created a list of points to remember when considering the timeline for filing:
● The tax extension request form, known as the 4868, must be submitted by Tuesday, April 15 — for businesses, the deadline was March 15 — in order to be eligible for the six-month extension.
● To complete the extension request form, the IRS requires an estimate of your total income and tax bill, with payment for the estimated amount included. Once you finalize your return, the IRS will determine how much you overpaid or underpaid, and that amount will be balanced after the fact.
● If you are facing financial hardship or are otherwise unable to pay your taxes, the IRS offers payment plans.