How (and When) to File an Income Tax Extension
The federal income tax returns are normally due on April 15th. This year, the 15th falls on a Sunday, so the due date should be Monday the 15th. However, Monday the 16th is Emancipation Day so the due date is Tuesday 17th. Some people aren't prepared to file. Others may be waiting for Form K-1's from their investments. Either way, if the return is not filed on time, an extension will need to be filed.
An extension is filed by completing Form 4868. The extension will allow six months, or until October 15th to file the return. The extension will extend the time to file the return, it does not extend the time to pay the tax. Any tax that is due needs to be paid by April 17. Failure to pay by the due date will result in penalties and interest being assessed.
Connecticut taxpayers that need an extension will also need to file form CT-1040-EXT. Like the federal extension This is also due on April 17, it will allow an additional six months to file and the tax needs to be paid then.
Taxpayers that want to fund an IRA or a Roth IRA need to fund this by April 17. Self-employed people that want to fund a Simplified Employee Pension ("SEP") have until the due date of the return, including extensions to fund this vehicle. Caution should be exercised when completing these tax forms. One year, a taxpayer owed both the Federal Government and the State of Connecticut. He put his checks in and sent off the extensions. Unfortunately, he enclosed the federal check with the Connecticut extension and the Connecticut check with the federal extension. It took us a while, but we were finally able to sort this out.
As with other forms of communication with the tax authorities, we recommend these forms be filed Certified Mail, Return Receipt Requested.
ACTION ITEM: Taxpayers that can't file by April 17th, need to file an extension.
Thomas F. Scanlon, CPA, CFP®