Everything you need to know about filing a tax extension

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If you already anticipate needing some extra time to file your federal tax return, there’s some good news. You can always file for an extension.

This year, you’ll get until Oct. 17.

However, there are some things to know: “Please be aware that an extension of time to file your return does not grant you any extension of time to pay your taxes,” the Internal Revenue Service’s website reads.

Find out what to do if you can’t pay what you owe by April 18.

So, what link should I use to e-file an extension form?

If you’re filing individually, this is the one you want. It’s free to use.

Otherwise …

There are a whole slew of options and forms to fill out, depending on whether you’re a person or a business, and your specific filing status. Go to this website to find the link(s) most applicable to you.

The bottom line

While it might seem easier to file for an extension -- and depending on your circumstances, maybe you’ll have to -- don’t just look at this option as a way to buy some time. Only do this if you really have to. You still have to pay now, or you’ll risk the IRS coming after you (although that doesn’t happen for quite some time), or having to pay a bunch of interest.

Here are some considerations and recommendations, taken from the IRS website:

  • “File all tax returns that are due, regardless of whether or not you can pay in full. File your past-due return the same way -- and to the same location where you would file an on-time return.”
  • “If you have received a notice, make sure to send your past due return to the location indicated on the (same) notice you received.”
  • “File your past-due return (as soon as possible), and pay now to limit interest charges and late payment penalties.”
  • “You risk losing your refund if you don't file your return. If you are due a refund, you must file your return to claim it within 3 years of the return due date.”
  • “We hold income tax refunds in cases where our records show that one or more income tax returns are past due -- until we get the past-due return or receive an acceptable reason for not filing a past-due return.”
  • “If you are self-employed and do not file your federal income tax return, any self-employment income you earned will not be reported to the Social Security Administration and you will not receive credits toward Social Security retirement or disability benefits.”
  • “Loan approvals may be delayed if you don't file your return. Copies of filed tax returns must be submitted to financial institutions, mortgage lenders/brokers, etc., whenever you want to buy or refinance a home, get a loan for a business, or apply for federal aid for higher education.”

Finally, if you owe and you truly can’t afford to pay right now, you have some options.

You can request an additional 60 to 120 days to pay your account in full through the Online Payment Agreement application or by calling 800-829-1040. If you need more time, request an installment agreement -- or you may qualify for an offer in compromise.

Learn more about those options here: Payment plan information | Offer in compromise

One last thing (we mean it this time).

If you fail to file, the government just might do it for you. This “substitute return,” as it’s called, might not give you all the credits and deductions you’ve earned, so this is not your ideal situation.

The return the IRS prepares for you will lead to a tax bill, which, if unpaid, will trigger the collection process -- which comes with it a possible levy on your wages or bank account, or the filing of a notice of federal tax lien.

If you repeatedly do not file taxes, you could be penalized or prosecuted.

Visit this IRS website if you have questions, need to download any forms, or have a specific situation to look into. Happy filing!

This story was first published in 2019. It has since been updated.