The tax filing deadline for federal income taxes is long finished and taxpayers who filed an automatic extension to get more time to file their returns still have time to do so.
The tax filing extension deadline grants six additional months on top of the original filing deadline, making the deadline to file taxes October 15. However, because the Internal Revenue Service already extended both filing and payment deadline to May 17 for the 2020 taxes filed in 2021, you got less than six months to file your return. Prior to the 2020 taxes, taxpayers had until July 15 to file and pay their federal income taxes. That tax season was no exception. Even if you placed an extension on your tax return, you got until October 15 to file your return. Having said that, the federal income tax filing extension deadline is October 15 whether the IRS extends the original due date or not.
Is it worth filing a tax extension?
The answer to it depends largely on your current situation. Sometimes we may not be ready to file our tax returns due to missing information we have. Not having the necessary tax forms to report the income earned or waiting for information returns from the people and companies that we’ve worked with can also cause us to wait longer. Although the Internal Revenue Service has substitute forms to report income earned, it’s safer to wait for them to be furnished to you rather than reporting income on your own.
These can be overwhelming especially when the tax filing deadline approaches. The simple solution to it all and what makes sense is filing an extension. Simply file your extension and don’t worry about the filing deadline, at least for some time. While filing an extension is the answer to get more time to file your return, you must pay any tax owed by the original deadline, whether it be April 15 or another deadline the Internal Revenue Service sets.
Owing taxes after an extension
In a case where you file an extension but end up owing the Internal Revenue Service at the time of filing, you will have to pay late-payment penalties which can add up to a significant amount if you don’t file your taxes right away. You can pay anywhere between 5 and 25 percent of unpaid tax in penalties. It’s always best to estimate taxes at the end of the year and compare it with the total amount of tax paid during the tax year.
If you’re an employee working for an employer, you can take a look at your last pay stub to see the federal income taxes withheld throughout the year and put it side by side with your estimated tax bill. Even if there is a slight chance that you may owe taxes, we highly suggest making a payment to the Internal Revenue Service. It’s a lot better to pay Uncle Sam only to get your money in a couple of months than paying more than what you would pay otherwise.