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Important things to consider regarding a tax return extension.

As we approach the April 15th due date, you might be considering the extension of your 2021 individual tax return. An individual tax return can be extended by Filing Form 4868 with the IRS, and the new due date becomes October 15th. Unfortunately, many people are incorrectly under the impression that if they owe on their tax return, they can delay paying the taxes by filing for an extension. This is not the case and you may be subjecting yourself to expensive penalties and interest by the IRS.

The most important things to remember about an extension of your return are:

1) An extension is an extension of time to prepare and file the tax return, and it is not an extension of time to pay your taxes.

2) You are required to estimate and pay any taxes owed by your regular deadline. If you are unsure of how much you will owe, over estimate and shoot high. You can send a payment for your taxes with the paper Form 4868 or you can make a payment electronically through the IRS website.

3) Penalties and interest begin accruing on the amount of taxes not paid by April 15th.

4) If you are due a refund on your taxes, the deadline to file your taxes is actually 3 years from the due date. The IRS gives you three years to claim your refund and you are not charged any penalties or interest. The IRS will actually pay you interest on the amount of the refund.

** As a Storen Policy: we will file an automatic extension for all previous years’ clients by the due date. If you are new to Storen and you would like help filing an extension, give us a call and we will file an electronic extension for you.

Information from IRS.gov – Extension of Time To File Your Tax Return – Click here to read more.

Click here to learn more about our tax planning and preparations services.
Or click here to contact us with any questions you have.

 

 

Blog by Daniel Walters – Tax Accountant

Learn more about Daniel and the rest of the Storen Financial team here.