Posted: 10:07 a.m. Thursday, March 28, 2013
You can file for an extension on any ground you like. All it takes is filling in Form 4868 to extend the deadline to Oct. 15.
The hitch is that the extension applies only to the paperwork — namely, the return itself. You still have to pay your taxes by midnight on April 15. The money has to be sent in with your extension request. If you don’t pay the full amount, you’ll owe interest and penalties on what’s missing.
So why would you bother to file for an extension if you still have to calculate what you owe and pay your taxes now? There are several reasons. I’ll give you the top three.
You don’t have all the documents yet. For example, if you’re in a partnership, you might be waiting for the crucial K-1 form, which is often late.
You’re self-employed and you need more time to fund your retirement plan. You can add money to your 2012 SEP-IRA or solo 401(k) right up to the extended deadline in October.
You can’t pay all the taxes due. There’s a big penalty for failing to file a return on time. You can avoid that penalty by filing for an extension by April 15 and paying as much of the tax as you can. You’ll owe interest and penalties on amount still due but at least you have an extra six months to get it together.
Any online tax service should include Form 4868, if you decide to file it. Or you can print it out directly from the Web.
Just remember — the IRS still wants your full tax return. So mark your calendar for the extended drop-dead hour, midnight on Oct. 15.