Tax Extension Center continues its series of The Top 100 Reasons to File a Tax Extension. Our aim is to inform taxpayers that a tax extension can be a valuable option because it saves time, stress, and even money.
Here’s reason #49: you can’t afford to make a tax payment, but you don’t want to compound the issue by not doing anything.
During tax season, you have 4 options when it comes to filing your taxes:
For the sake of reason #49, let’s talk about options 3 and 4.
Option 4, despite being popular, is not really a good option. Not paying what you owe is not advised, but also easier said than done for a lot of Americans (especially these days). But choosing not to at least file a tax extension can make you subject of late filing penalties.This is much more avoidable than than paying what you owe.
That brings us to Option 3 and reason #49 – if you at least file a tax extension, then you avoid the late filing penalty. When money isn’t readily available enough to pay what you owe, saving as much as possible is an attractive option.
You might be considering filing a tax extension for the first time. Or maybe you file one every single year. Either way, remember that a tax extension does not give you more time to pay what you owe the IRS. You still need to make your payment by midnight on April 15. An IRS extension gives you more time to file the necessary tax forms you’re supposed to file. Failing to make a payment could make you subject to tax extension penalties and interest.
Got any thoughts about tax extensions? Let’s chat in the comment section below.
Tax Extension Center continues its series of The Top 100 Reasons to File a Tax Extension. This series is intended to show taxpayers that a tax extension is valuable because it saves individuals and/or their businesses time, stress, and even money.
Here’s reason #40: Electronic Funds Withdrawal (EFW) allows you to include an electronic payment to the IRS with your extension.
Whether you are new to filing an IRS extension or you file one every year, remember that a tax extension does not give you more time to pay what you owe the IRS. You still need to make your payment by midnight on April 15. An IRS extension gives you more time to file the necessary tax forms you’re supposed to file. Failing to make a payment could make you subject to tax extension penalties and interest.
If you’ve been reading our Top 100 list, you know that I highly recommend that you e-file a tax extension over submitting it by mail. After all, it’s automatic as long as you fill out the form correctly.
The added benefit to e-file is the ability to include a payment directly from your checking or savings account. The IRS calls this type of payment and Electronic Funds Withdrawal. The even better part is that it’s simple. All you have to provide is your account number, your bank’s routing number, and the date you want the funds taken out of your account (make sure that date is before the deadline).
So no need for checks, just take the easy route and have your tax liabilty included with your tax extension.
Have you ever filed an IRS extension to file taxes for yourself or your business? Thinking about filing one this year? Drop me a note in the comment section below.
