Filed Tax Extension ? Now what?

tax extension

Generally , tax extension is granted automatically if you apply for extension in time. But ,if you use the U.S. mail to send your extension, and did not receive a confirmation,you should contact IRS to inquire about tax extension application status. You can also call the IRS customer service number to determine if your request for an extension was received and approved.

What about state tax extension status?

If you are granted a six-month extension, the extensions generally automatically extend your state income tax deadline.Some states require that you must file a separate tax extension application . In that case , if you did not receive any confirmation after filing extension, you’ll have to contact the taxing authorities in your state to check on its status.

Extension is for filing , not for tax payment !

The tax extension you applied for merely grants you a new extended deadline for filing the tax return. However, grant of six more months to file taxes doesn’t extend time to pay any taxes that you may owe on your total income for the tax year. Be ready for penalty and interest if you don’t pay your tax balance by the filing deadline (April 15 in 2020 for tax year 2019). Since , penalty and interest are based on the amount you owe and the period for which you owe it, it is good idea to pay as much as you can . Late payment penalties are calculated at 0.5% of the unpaid tax balance per month. The maximum you can be charged in late payment penalties is 25% of the unpaid tax.

Going abroad? a small relief available.

For tax payers , who are going out of the country on tax day, a two-month extension that allows you to hold off paying taxes without penalty is allowed . But, you will still be assessed interest as of the day after the tax filing deadline.That means that if you are granted a two-month extension because you are out of the country on tax day, you have until June 15 to file your return and pay your tax.

Be alert ! tax extensions may also be rejected.

While most tax extension applications are approved automatically ,IRS may may reject tax extension requests on account misspellings, switched numbers and other errors on the extension form or wrong or old addresses or names that don’t match up to the IRS records. However, IRS allows generally five days to rectify errors or fix issues with your request in order to file again.