Can’t file by April 15? Nearly 147,000 CT taxpayers expected to file for extensions
The Internal Revenue Service is reminding taxpayers that quick and easy solutions are available if they can’t file their returns or pay their taxes on time, and they can request payment options online.
Taxes are due by midnight on Tuesday, April 15, but the IRS expects nearly 147,000 Connecticut taxpayers will file for an extension.
If you can’t make the deadline, IRS officials say don’t panic. Tax-filing extensions are available to taxpayers who need more time to finish their returns.
Not an extension to pay
Remember, this is an extension of time to file; not an extension of time to pay. However, taxpayers who are having trouble paying what they owe may qualify for payment plans and other relief.
Either way, taxpayers will avoid stiff penalties if they file either a regular income tax return or a request for a tax-filing extension by the April 15 deadline. Taxpayers should file even if they can’t pay the full amount due.
Here are further details on the options available:
More time to file
People who haven’t finished filling out their return can get an automatic six-month extension. The fastest and easiest way to get the extra time is through the Free File link on IRS.gov.
In a matter of minutes, anyone, regardless of income, can use this free service to electronically request an automatic tax-filing extension on Form 4868.
Filing this form gives taxpayers until Oct. 15 to file a return. To get the extension, taxpayers must estimate their tax liability on this form and should also pay any amount due.
By properly filing this form, a taxpayer will avoid the late-filing penalty, normally 5% per month based on the unpaid balance that applies to returns filed after the deadline. In addition, any payment made with an extension request will reduce or eliminate interest and late-payment penalties that apply to payments made after April 15.
That interest rate is currently 3% per year, compounded daily, and the late-payment penalty is normally 0.5% per month.
Besides Free File, taxpayers can choose to request an extension through a paid tax preparer, using tax-preparation software or by filing a paper Form 4868, available on IRS.gov. Of the more than 12 million extension forms received by the IRS last year, over 7 million were filed electronically.
Automatic filing extensions for some
Some taxpayers get more time to file without having to ask for it. These include:
Taxpayers abroad: U.S. citizens and resident aliens who live and work abroad, as well as members of the military on duty outside the United States, have until June 16 to file. Tax payments are still due April 15.
Members of the military and others serving in Afghanistan or other combat zone localities: Typically, taxpayers can wait until at least 180 days after they leave the combat zone to file returns and pay any taxes due. For details, see Extensions of Deadlines in Publication 3: Armed Forces’ Tax Guide.
People affected by certain recent natural disasters.
Easy ways to e-pay
Taxpayers with a balance due now have several quick and easy ways to electronically pay what they owe. They include:
Electronic Federal Tax Payment System: This free service gives taxpayers a safe and convenient way to pay individual and business taxes by phone or online. To enroll or for more information, call 800-316-6541 or visit www.eftps.gov.
Electronic funds withdrawal: E-file and e-pay in a single step.
Credit or debit card: Both paper and electronic filers can pay their taxes by phone or online through any of several authorized credit and debit card processors. Though the IRS does not charge a fee for this service, the card processors do. For taxpayers who itemize their deductions, these convenience fees can be claimed on Schedule A, Line 23.
Taxpayers who choose to pay by check or money order should make the payment out to the “United States Treasury.” Write “2013 Form 1040,” name, address, daytime phone number and Social Security number on the front of the check or money order.
To help insure that the payment is credited promptly, also enclose a Form 1040-V payment voucher.
More time to pay
Taxpayers who have finished their returns should file by the regular April 15 deadline, even if they can’t pay the full amount due. In many cases, those struggling with unpaid taxes qualify for one of several relief programs, including the following:
— Most people can set up a payment agreement with the IRS online in a matter of minutes. Those who owe $50,000 or less in combined tax, penalties and interest can use the Online Payment Agreement to set up a monthly payment agreement for up to 72 months.
Taxpayers can choose this option even if they have not yet received a bill or notice from the IRS. With the Online Payment Agreement, no paperwork is required, there is no need to call, write or visit the IRS, and qualified taxpayers can avoid the filing of a Notice of Federal Tax Lien if one was not previously filed.
Alternatively, taxpayers can request a payment agreement by filing Form 9465, which can be downloaded from IRS.gov and mailed along with a tax return, bill or notice.
— Some struggling taxpayers may qualify for an offer-in-compromise. This is an agreement between a taxpayer and the IRS that settles the taxpayer’s tax liabilities for less than the full amount owed.
The IRS looks at the taxpayer’s income and assets to make a determination regarding the taxpayer’s ability to pay. To help determine eligibility, use the Offer in Compromise Pre-Qualifier, a free online tool available on IRS.gov.
Details on all filing and payment options are on IRS.gov.