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Extensions: They Are Our Friend

Updated: Feb 14, 2023

❌ April 15 is not the tax return due date (as long as an automatic extension is filed).


✅ April 15 is a glorified estimated tax payment deadline. Your main concern should be paying any outstanding tax liability for the prior year (and Q1 of the current tax year).

Extensions are our friend.

  • Extensions are easy.

  • Extensions give us more time to file.

  • Having more time to file puts less stress on our talented staff.

  • Having more time ensures we are thinking through all possible strategies and scenarios which could ultimately lead to a lower tax bill.

Form 4868 - Request for an Extension: What is it?

  • Filing an extension changes the due date to file your tax return; it moves from April 15 to October 15.

  • Extensions are automatically granted by IRS; you do not need a reason to file an extension.

Does an extension increase my chance of audit?

  • There is zero evidence that an extension increases your risk of audit.

  • Some financial professionals believe filing an extension actually decreases your risk of audit, but this has not been verified by IRS.

  • The IRS does not frown upon extensions.


Leslie, Nick & Lisa all file extensions for their personal returns.

  • If extensions had negative consequences, we would not do it for ourselves.


Do I have to wait until October for my personal return to be filed?

  • No, we will continue to finalize returns starting after April 15 (after a short breather).

  • Our goal is to have everyone who submitted their stuff to us before March 31 to be complete by May 31.

Will I be penalized?

  • Maybe...an extension is an extension to file, not an extension to pay.

  • If you think you have a balance due, making a payment with your extension could save you some penalties and interest.

  • If you are due a refund, there is no penalty for filing an extension.

What does IRS charge for paying the tax due after April 15?

  • For 2022, the interest + penalties is about 1% per month (about $10 for every $1,000 you owe, per month).

  • Example: $5,000 balance due paid June 15 is $100 ($5,000 x .01 x 2 = $75)

How much should I pay with my extension?

  • CPAs are available to prepare an extension estimate a week before the April 15 deadline.

  • An extension estimate costs between $150-$250 depending on the complexity of your tax situation.

  • If you anticipate owing less than $10,000 then it's probably not cost-effective to request an extension estimate (based on the interest & penalty cost vs. CPA estimate extension cost).

If you don't have the money to pay IRS, then don't request an extension estimate.

  • You would be surprised how many people respond by saying "I can't pay anything" after we prepare an extension estimate.




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