(WWLP) – Doing your taxes can be stressful. Filers of all ages can be confused by tax rules and figuring out which documents are required. If you are still missing key forms, or feeling overwhelmed, you can file for an extension.
Filing for an extension is not a bad thing; there is no penalty for filing for an extension. However, not paying on time, not paying enough, or failing to file altogether can cost you. An extension only gives you more time to finish the paperwork; not more time to pay.
Your tax payment is due on the tax deadline, which falls on April 18 this year.
If you know that you will be getting a refund, you won’t need to worry about paying when you are filing an extension, but the earlier you file your return, the earlier you will see your refund.
If you think or know that you will owe, you should estimate what you will owe, and pay the amount due when you file Form 4868.
22News spoke with Ray Maggero of Liberty Tax about steps you should take to file an extension. “It’s not an extension of time to pay your taxes. It is an extension of time to file your tax return. Penalties, by the way, for late filing are much larger than penalties for late payment, so you want to get a tax return filed or an extension filed so that you avoid the late filing penalties,” Maggero said.
Before filing that extension, the IRS says you should estimate and pay any owed taxes by your regular deadline to avoid possible penalties. You also must file your extension request no later than the regular date of your return.
If you file for an extension, but don’t pay the full amount owed, the IRS will charge you interest on the unpaid balance until you pay the full amount. If you don’t pay at least 90% of the amount you owe, you may also be subject to a late payment penalty.
If you file for an extension, you will have until October 15 to gather your documents and finish your filing.