Every year, many taxpayers file an Application for Automatic Extension of Time to File U.S. Individual Income Tax Return. This extension deadline is October 15 of each calendar year. Some of those taxpayers who file an extension request will also unwisely wait until October 15th to pay the income tax owed for the previous year. The filing extension is an extension of time to file the return, not to pay the income taxes that are owed. Even if a taxpayer files a filing extension, he or she must pay all of the income tax owed no later than April 15th of that same year. If the tax is not paid by April 15, the taxpayer will be subject to a Late Payment Penalty.
Also, if a taxpayer does not have money to pay the income tax owed by October 15th, he or she sometimes chooses to not file a Form 1040 – US Individual Income Tax Return at all. It is imperative that each year’s Form 1040 – US Individual Income Tax Return be filed by its deadline, even if the taxpayer does not have all or any of the funds to pay towards the tax owed. Not doing so risks the Internal Revenue Service assessing a Late Payment Penalty, a Late Filing Penalty, and the Internal Revenue Service filing an income tax return for the taxpayer. This is known as a Substitute for Return.
If you filed for an extension and have not yet filed your return, or have not paid the amount due in full, you will be assessed penalties and interest that will continue to accrue. Do not let this problem linger in the background…now is the time to take action. If you have any questions, or would like a free update on your options please call us at 888-589-0955.