A Look Ahead: Deadline for Filing Extended Tax Returns is Approaching
Earlier this year, we saw Congress pass the Fiscal Cliff tax deal in January, the subsequent IRS processing delays of various tax forms, and a staggered opening to tax season. If you’re one of the many who obtained an extension of time to file, the extended deadline is fast approaching.
The extended deadline for Form 1040, U.S. Individual Income Tax Return (Individuals), is October 15, 2013. However, the extended deadline for many business returns is much sooner. The extended deadline for the following forms is September 16:
- Form 1065 U.S. Return of Partnership Income (Partnerships)
- Form 1120S U.S. Income Tax Return for an S Corporation (S corporations)
- Form 1120 U.S. Corporation Income Tax Return (C corporations)
- Form 1041 U.S. Income Tax Return for Estates and Trusts (Estates and Trusts)
Don’t forget about your state and local returns. Although the extension procedures vary widely among the states, many states provide similar periods of time to file an extended return. If you obtained an extension for state or local returns, see our article, “Filing a Federal Extension? Don't Forget About Your State Return.”
Given that August is almost half over, only a limited amount of time remains to talk to your advisor and get your documents in order.
September 16 is also the due date for the third installment of estimated taxes.
Filing Extensions Do NOT Extend the Time to Pay Tax
Filing extensions give you extra time to file your return, but not to pay your tax. Individuals still had to estimate and pay tax by April 15, 2013, even if they obtained an extension of time to file their Form 1040 tax return.
Interest and penalties could be imposed if you fail to file on time, pay on time, or both. And, they can add up quickly.
Processing-delay relief. The IRS has recognized that the processing delays earlier this year may have affect some taxpayers’ ability to timely estimate and pay their tax liability when requesting an extension. If you requested to file an extension for a return that includes one of the forms on the IRS list, you may be able to get the failure-to-pay penalty abated. However, additional requirements apply, including:
- a good-faith effort to properly estimate the tax liability on the extension application had to have been made
- the estimated amount had to have been paid by the original due date of the return
- any tax owed on the return must be fully paid no later than the return’s extended due date
Consider consulting your advisor as soon as possible if you haven’t paid enough tax, if you have received any kind of notice from the IRS, or both. Payment arrangements may be available, which can be far less burdensome than running up interest and penalties. Even better, your advisor could help you take the right steps to hopefully qualify for the IRS’s processing-delay relief.
FTA penalty relief. Taxpayers who have reliably paid their taxes may be eligible for first-time-abatement penalty relief. See our article, Do You Owe the IRS? This Program May Help .