How to Get an Extension to File Your Taxes
If you've put off filing your taxes until it's too late to get it done on time, or if your tax returns are going to be a bit more complicated than you thought, you have the right to ask the IRS for an extension to file. The extension, once approved, will give you an additional 6 months to file your tax returns. That gives you until October 15th to file your taxes as an individual, or sole proprietor. For corporate returns, the extension lasts until September 15th.
In order to get your extension, you need to file IRS form 4868. To complete the form, you'll need to estimate the amount of refund you expect to receive, or the amount of taxes you expect to owe. The amount that you expect to owe is still due by April 15th (March 15th for businesses). The extension is only an extension to file your tax returns, not an extension to pay your taxes. If you are not able to pay on time, you can expect to be charged a penalty of about 0.5% per month. So, if you owe $5,000, it'll cost around $250/mo in penalties.
The form itself is fairly easy to complete, other than estimating your taxes. There are online services available that make the whole process much easier by asking a few basic questions, and running your numbers through a tax estimator. Another option is to use last year's return to estimate your current tax obligation. Remember, this is only an estimation of taxes owed, but if your numbers are way off, you could end up owing the IRS interest and penalties.
The IRS will let you know, within a few days, whether your extension was granted, or denied. Very few extension requests are denied (the IRS even refers to it as an automatic extension to file). If you are denied, it's usually because of an error in filling out the form. If that's the case, you can re-submit a corrected form. If your extension is granted, you're not obligated to use it, so filing for an extension can be used as a safety net, just in case you don't get your return in by the deadline.
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