Friday, September 23, 2016

The Truth About the October Tax Extension

Were you unable, for whatever reason, to get your taxes filed by the April deadline? If so, you may have thought it was “no big deal” since extensions are fairly easily granted and give you until October 17th to file. Unfortunately, though, a lot of people who get extensions waste that extra six months and don’t prepare like they should. Don’t be that person! Also, make sure to educate yourself about this “convenient” tax deadline so that you can determine if it’s really the best move to make in the future.

You Still Have to Pay Owed Taxes

First things first, if you owed taxes, don’t think that just because you got an extension on your tax return, you also got an extension on the money owed. You still owe that money, and, if you don’t pay it on time, you’ll usually get hit with penalties and interest. Talk to your accountant about what you can do to avoid fees and penalties or at least to reduce what you owe.   

You Can Extend Again

If you do end up needing more time to file come October, you MAY be able to get another extension, but don’t bank on it. Typically, second extensions are only offered for extenuating circumstances, such as living outside of the United States or being deployed. If you think you may need another extension, ask your tax adviser what you can do and if you qualify.

The bottom line in all of this is that, whenever possible, you should try and file your taxes on time. Request an extension only if you really need it and, then, for best results, work with an accountant to help you go through the process smoothly.