Taxes are due April 18th this year. Taxpayers can request an automatic six-month extension of time to file your tax return. But, taxpayers beware, there is a catch! An extension is just an extension on the time to file the return; it is not an extension on the time to pay!
Taxpayers are required to estimate the amount of tax that may be due with the tax return and remit payment with the extension to avoid Failure to Pay penalties. These penalties, plus interest, could accrue from April 18th until the tax is paid, regardless of the extension. If a balance is still owed when the actual tax return is filed, at least the penalties and interest will have been minimized.
If taxpayers are unable to file their tax return by April 18th, there are several ways to request an automatic extension of time to file an individual return. Enrolled agents and other tax professionals can e-file the Application for Automatic Extension of Time to File US Individual Tax Return for taxpayers. Whether taxpayers use a tax professional or submit the application themselves, all or part of the estimate of the income tax due can be paid with a check, credit/debit card, or by using the Electronic Federal Tax Payment System.
If a taxpayer estimates that they will owe taxes and is unable to pay, it is important that they file their returns timely. Failure to File penalties may be assessed in addition to Failure to Pay. So, to minimize penalties it is always best to file the return or an extension and remit as much as possible with either. Payment plans may later be established.
Even if you do not have all your paperwork, it might make sense to get your return mostly prepared as we face the upcoming tax filing deadline, contact NGAS to file your extension if you are not ready.