Some people just can't seem to get their tax return completed and filed by April 15. Others just don't have all of their documents as they’re still waiting for the K-1's from their partnership investments. Still others have inertia and just don't want to deal with it.
If you can't file your return on time, you will need to request an extension. To request an extension of time for your federal return, you will need to complete and file Form 4868. If your state has an income tax, you will also need to file an extension with that state. These extension requests are due on April 15.
It’s important to understand the extension only extends the time to file the return. It does not extend the time to pay any taxes due. If you owe taxes, these need to be paid by April 15. If the tax is not paid, interest will be due on the balance owed. Additionally, penalties may be charged depending on the amount owed. A properly filed extension that is accepted by the IRS will allow a taxpayer until October 15 to file their return. If you don't file your return by April 15 and you don't request an extension of time to file, you may be assessed a penalty for failure to file. This penalty will be assessed if there is a tax due.
If you want to fund an IRA or a Roth IRA, this will have to be made by April 15. Self-employed people who fund a SEP account may want to extend their return. A SEP account can be funded at anytime up to the due date of the return, including extensions.
As with other tax forms, we recommend the application for extension be mailed by Certified Mail–Return Receipt Requested. This will provide you with proof of mailing.
ACTION ITEM: If you can't get your tax returns completed and filed by April 15, file for an extension.
Thomas F. Scanlon, CPA, CFP®