If you have money withheld from your paychecks throughout the year and are anticipating a refund, this doesn't really matter to you. It does not, however, extend the time you have to pay your taxes. For the 2015 tax year (the return you'll file in 2016), this means that your extension gives you until Oct. If you filed an extension and it was accepted by the IRS, it extends the deadline to file your taxes by six months. What a tax extension is, and what it isn't Here's why you shouldn't wait until the last minute, what to do if you owe the IRS money, and what to do if you still aren't 100% ready to file by the deadline.
17 to file your federal income tax return. And, of course, when in doubt, talk to a tax professional.If you filed a tax extension with the IRS in 2016, you have until Oct.
Simply file for an extension by your normal tax deadline, and remit any payment you expect to pay in taxes. Remember, if that clock’s ticking and you’re nowhere near finished with your tax return this year, panicking isn’t necessary. This can be done via check or credit/debit card, or via a government payment option like Direct Pay! or through. If you submit your request electronically, still make a payment for anticipated tax liability. If you send your filing request by mail, you can include payment for what you think you’ll owe to minimize or avoid any late payment penalties. Getting a filing extension does not give you more time to pay what you owe. An Extension Doesn’t Give More Time for Payment However, owners must cover employees in most cases, so factor in the after-tax cost of making contributions. The SEP plan can be used by a corporation or any unincorporated business. If you did not sign any paperwork by the end of the year, you can still set up and fund an SEP plan for 2014 by the extended due date of the 2014 return. If you obtain a filing extension, you have until the extended due date to fund a qualified retirement plan that was set up by the end of 2014. Late filing fees are also tacked on to your penalty bill from the IRS. The failure to give K-1s to owners in a timely manner is subject to a penalty of $100 per K-1. If you are a pass-through entity (a partnership, LLC, or S corporation), the filing extension applies not only to the tax return, it also applies to Schedule K-1 that you must furnish to owners. There has been no statistical evidence that obtaining a filing extension increases your chances of being audited. If Spring is your busy season, which prevents you from getting your records in order, or your tax preparer is excessively busy, obtain an extension. You can request a filing extension for any reason. C corporations: Form 7004 (code 12) No Questions Asked.Limited Liability companies (LLCs): Form 7004 (code 09).Sole proprietors and one-member limited liability companies treated as disregarded entities: Form 4868.Your business’s entity type dictates the form to use in making your return. So, if you’re an S corporation with three owners and delay filing for two months without having asked for an extension, the penalty is $1,170. This penalty could be even higher because the Tax Increase Prevention Act of 2014 gave the IRS authority to increase it for inflation for returns due after 2014 no increase has yet been announced.ĭifferent penalties apply to Schedule C filers and C corporations. For example, for partnerships and S corporations that do not even pay any federal income tax, the penalty is $195 per month (or part of the month) per owner for the length of the tardiness. If you fail to file the return on time and don’t ask for an extension, the penalties can be hefty. 15, 2015 for Schedule C filers) to submit this year’s returns.
Businesses that make a filing request have until Sept. The only catch is that you must file the request for an extension by the deadline you’re expected to meet for filing your return. A filing extension is automatic. You get it simply by asking the IRS for it.
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