Can I Be Denied a Tax Extension?

If tax deadlines are looming and you’re nowhere near ready to file, a tax extension might be the perfect solution. The IRS can’t deny a tax extension if your request is made timely, but you’ll want to secure proof of your application in case the IRS ever challenges whether it was sent. If you estimate that you’re due a refund for the year, you don’t need to apply for an extension. You have up to three years to file and receive your refund without penalty.

Automatic Extension

If you need extra time to prepare your return, you can apply for an automatic extension to file by submitting IRS Form 4868 to the IRS. Each year, every taxpayer has the ability to request an automatic extension with the IRS. The IRS can’t deny your request for an automatic extension, even if you owe back taxes or have unfiled returns.

Deadline

You must submit IRS Form 4868 electronically or by mail, or pay all or part of your estimated income tax by April 15. If you send the form by mail, send it certified. This gives you a post mark and tracking number. If your extension is lost in the mail or the IRS claims it was never received, you’ll have proof of when it was sent. The extension grants you an additional six months to file your tax return and your new due date for your return will be October 15.

Extension to Pay

An extension to file is not an extension to pay. The extension to file gives you until October 15 to prepare and file your return, but not to pay your tax. When you file an extension, the IRS expects you to estimate your potential tax liability and pay the amount before the original April 15 filing deadline. If you owe tax and wait until October 15 to pay, the IRS assesses a late payment penalty. However, if you think you owe and are requesting the extension to allow extra time to come up with the cash, it’s still better to file the extension than not. If you don’t file the extension and just wait until you have the money to file, you’ll incur a late filing penalty as well.

State Tax Extensions

Each state creates its own rules for tax extensions. If you request an extension with the IRS, most states grant an automatic extension to file your state return as well. In most cases, it’s not necessary to file an additional request with your state. However, some states will deny an automatic extension if it determines you owe state taxes and don’t send the payment when the return is due. When this happens, the state assesses penalties and interest retroactively. These assessments can rack up your total balance a lot quicker than you might expect. Check the tax extension rules of your state if you’re planning on filing federal and state tax extensions.

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