Extension to pay vs Extension to file

Taxes

Taxes (Photo credit: Tax Credits)

Individual income tax returns are due on April 17, 2012 (tomorrow). If you need to file an extension to file your tax returns, you can do so by completing Form 4868 http://www.irs.gov/pub/irs-pdf/f4868.pdf – or online at any free third-party IRS approved vendor site http://apps.irs.gov/app/freeFile/jsp/index.jsp?ck. This is an extension to file your income tax returns… it is NOT an extension to PAY your income tax returns.

The IRS announced last month it’s Fresh Start initiative program. One part of this program offers relief to certain taxpayers in PAYING their taxes.  To be eligible for this, you must have either 1) been unemployed for at least 30 days in 2011 and/or through April 15, 2012.. OR 2) been self-employed and had a 25% decrease in revenue (relative to 2010) due to the economic downturn. If you fall into one of these categories you can file Form 1127-A http://www.irs.gov/pub/irs-pdf/f1127a.pdf to request a six month extension to pay your taxes (only eligible if owing under $50k in taxes). As long as your taxes are paid by October 15, 2012 this program gives the taxpayer an extension to pay their taxes without the 5% per month late filing penalty. Interest charges will still apply.

Remember, if you also need an extension to FILE your taxes, make sure your Form 4868 is also sent in by April 17, 2010.

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