Article
Tax extensions: Plenty to know, but nothing to fear
March 15, 2023 · Authored by Randi A. Schuster
When it comes to paying income taxes, some people have fears that are causes for concern. In other cases, people worry about aspects of taxation that are not areas of risk but lead to reasons for trepidation.
Filing for extensions is an example of a tax situation that falls into the second category.
Individuals may not want to file for an extension on their income taxes, because they are afraid of being audited. They believe extensions are a signal to the IRS to investigate them, as surely something must be amiss if a person, partnership or business does not file its taxes by April 15.
In reality, though, this is not the case.
What are tax extensions and why do people request them?
Extensions are simply an additional time to file a tax return – not an extension of time to pay the tax – but they do give a taxpayer more time to submit an accurate return.
Why do people file extensions? Some of the reasons include:
- They have a complicated tax return, or perhaps have faced major life changes over the past year
- They cannot find all of their forms, receipts or charitable contribution documents
- They do not want to rush and forget something or make an error on their tax return
- They need more time to research tax laws (following elections, passing of new legislation, etc.)
- They are not going to be at home, or by a computer, around the time of the filing deadline
If people who file extensions do get audited more frequently, it is almost certainly because of the type of income and investments that these people tend to have, and not because they are requesting extra time to file.
Other extension details: The how and when
Individuals can request an extension to file either electronically, or by completing and mailing Form 4868. Once requested, the extension will be granted automatically.
The extension request needs to be submitted by the April filing date, which typically is April 15. However, in some years, the date is moved slightly due to weekends or holidays. For instance, the 2023 filing date is April 18.
