Working late on tax returns? Here's how to file for an extension.

It's tax day, and if you're not done, just file for an extension instead of rushing to finish, experts say. It's easy to get an extension, and the penalty for not filing anything at all is high. 

Susan Walsh/AP
The Internal Revenue Service, with its headquarters in Washington shown here, doesn’t like to talk about it, but as long as you don’t owe any additional taxes, there is no penalty for filing a few days late.

On Monday – tax day – at 10 a.m. people were lugging in boxes of records so Dallas CPA Bill Dendy could file their taxes.

His reaction: “Oh, no!”

“It’s very difficult to do the return accurately,” he says. “But there is time to file for an extension.”

Indeed, if you are planning to rush home from work Monday to try to beat the midnight filing deadline, consider asking for an extension instead. Accountants and even the Internal Revenue Service say it’s important to get the return done accurately even if it means missing the deadline. However, asking for another six months does not mean that you don’t owe the IRS money, if you haven’t paid enough.

“You are still required to pay what you owe by April 15,” says Dean Patterson, a spokesman for the IRS. “The extension is just to get your return in order.”

 In other words, if you think you are going to owe money to Uncle Sam, you’re better off paying an estimated tax. Otherwise, if you don’t pay the estimated tax, you could ultimately end up paying the tax plus interest and a penalty.

How does this work?

Filing for an extension (form 4868) can be done electronically through the Free File link on, no matter what a household’s income.

When filing for an extension, the IRS requires filers to give a good ballpark estimate of taxes owed. If the taxpayer expects to owe the government, they need to make an estimated payment when asking for an extension.

“We understand the filers may not have all their records,” says Eric Smith, another IRS spokesman. “But if they hit it pretty well, they won’t owe any interest or late penalties.”

Anyone filing for an extension will have lots of company. According to the IRS, last year, some 10.7 million Americans filed for more time, a little bit more than the average of 10 million the previous couple of years. Last year, about half the requests for extensions were filed electronically.

Filing for an extension is important even if the taxpayer does not know exactly whether they will be getting a refund or paying the government. The penalty for failure to file is normally 5 percent per month on the unpaid balance. The penalty for the failure to pay the taxes due is 0.5 percent per month.

“It’s a pretty big difference and you can get an extension just for the asking,” says Mr. Dendy.

Over the years, the IRS has become more generous with extensions. Until the late 1970s, the extension was only two months. Then, around 1979, the extension was extended to four months. Around 2006, the IRS decided to give a six-month extension.

Taxpayers don’t even need a written reason to get the six-month delay. However, Dendy says a good reason is to make sure the return is done accurately. In a rush to get the return completed, he says it is easy to miss a piece of paper.

“Maybe a form 1099 gets lost or did not get to you,” says Dendy. “But that does not mean it did not get to the IRS, and so you could have unreported income.”

Unreported income can be a red flag for the IRS, which could result in an audit, he says.

After an initial extension, a taxpayer can still get more time “for cause,” says Mr. Smith. He estimates that probably one-third of people who have requested an extension, ask for a second one as well.

“Most were granted if there were a good reason,” says Smith, who says that the IRS grants the additional time on a case-by-case basis. Hardship, for example, would be a good reason to grant an additional extension. Dendy says that some of his requests for extensions are the result of real estate investment trusts delivering documents to their investors late. In addition, he says, the IRS was late in getting some tax documents done. And some people started doing their taxes and suddenly realized they were far more complex than expected and they needed help, he adds.

But, he says, the No. 1 reason for requests for extensions is taxpayer procrastination.

“I had one client who said the deadline just sort of crept up on him,” he says. “He lives in the East and the weather’s been so cold, he said it just did not feel like tax season.”

As far as the IRS is concerned, that’s just fine, too. Anyone can get an extension.

You've read  of  free articles. Subscribe to continue.

Dear Reader,

About a year ago, I happened upon this statement about the Monitor in the Harvard Business Review – under the charming heading of “do things that don’t interest you”:

“Many things that end up” being meaningful, writes social scientist Joseph Grenny, “have come from conference workshops, articles, or online videos that began as a chore and ended with an insight. My work in Kenya, for example, was heavily influenced by a Christian Science Monitor article I had forced myself to read 10 years earlier. Sometimes, we call things ‘boring’ simply because they lie outside the box we are currently in.”

If you were to come up with a punchline to a joke about the Monitor, that would probably be it. We’re seen as being global, fair, insightful, and perhaps a bit too earnest. We’re the bran muffin of journalism.

But you know what? We change lives. And I’m going to argue that we change lives precisely because we force open that too-small box that most human beings think they live in.

The Monitor is a peculiar little publication that’s hard for the world to figure out. We’re run by a church, but we’re not only for church members and we’re not about converting people. We’re known as being fair even as the world becomes as polarized as at any time since the newspaper’s founding in 1908.

We have a mission beyond circulation, we want to bridge divides. We’re about kicking down the door of thought everywhere and saying, “You are bigger and more capable than you realize. And we can prove it.”

If you’re looking for bran muffin journalism, you can subscribe to the Monitor for $15. You’ll get the Monitor Weekly magazine, the Monitor Daily email, and unlimited access to