How can I Apply for a Tax deferment?

Question

I am a U.S. Contractor currently working in a combat zone in Afghanistan and want to postpone filing my taxes until next year. What forms from the IRS must i complete and submit? Thanks!

Answer 1

www.irs.gov

http://www.irs.gov/businesses/index.html
They have all of the forms and instructions that you need for your business.

I give you this advice, based on my knowledge of business and corporations, and trying to protect you from penalties and interest that the IRS could impose.
The IRS expects every business owner to be knowledgeable of all their tax rules and regulations. They don't care if you must hire professionals in the USA to estimate, collect and pay the taxes for you, and to file for extensions. You must use your contacts to run your own business, and they don't care if your business is outside of the country - which has many different rules and regulations. I believe they will grant extensions for you to file - HOWEVER BE FOREWARNED - THAT THE IRS STILL EXPECTS TO RECEIVE THEIR MONEY REGARDLESS OF WHEN YOU FILE THE RETURN. EVEN IF YOU HAVE TO ESTIMATE YOUR INCOME, AND SOCIAL SECURITY TAXES DUE FOR EACH EMPLOYEE, YOU STILL MUST SEND THEM MONEY. You are not in the military, as you said you are a contractor, and as such you have overseas benefits for those working overseas - as in the instructions on the IRS site.

If you would like an extension to filing, you may download the form and send it to the IRS.

They even have sites where you can file electronically.

You may not postpone paying your withholding taxes for you and your employees and they are due monthly.
You business must make sure these are paid. Otherwise, you will have the taxes due, and penalties and interest on each and every month that they are due.
Plus the IRS could put a lien on everything you own.

The IRS is totally separate from any Federal contracting regulations. But know this: THE IRS CAN STOP YOU FROM BEING ELIGIBLE FOR CONTRACTS, AND CAN PUT A LIEN ON ANY INCOME YOU RECEIVE FROM YOUR CONTRACTING BUSINESS.

You must pay your taxes - and you can send in an estimate of taxes owed - say 30% of your Gross Income - to the IRS, and ask for an extension of time for filing.
Note: That you must file the extension for filing timely - and then they GRANT YOU AN EXTENSION. It is not automatic.

However still send in an estimate of your taxes owed, plus you must still send in social security taxes withheld for each employee (FICA) taxes. This is to stop any penalties and fees - which could be in the hundres of thousands of dollars - depending on your contacts which I estimate in the millions otherwise you would not be over there in such a risky atmosphere.

If you want more advice, you can add it to your quesions - as more information - as I can't accept emails directly as I'd have thousands and thousands asking for fee advice.

GOD bless us one and all, always - and please stay safe.
CPA-retired
I once owned a tax franchise in Heidelberg Germany!
MBA-Boston Univ.

Answer 2

Please see the following url's from www.irs.gov. They have great information that will apply to you.

According to Tax Topic 301:
"If you are serving in a combat zone or in a contingency operation (or are hospitalized as a result of an injury received while serving in such an area or operation), you have at least 180 days after you leave the designated combat zone/contingency operation to file and pay taxes."

The following is from the 3rd url below:
Q-18: My son is a civilian explosive specialist who is in a combat zone training U.S. Armed Forces personnel serving in a combat zone. Do the deadline extension provisions apply to my son?

A-18: Yes. The deadline extension provisions apply to your son because he is serving in a combat zone in support of the U.S. Armed Forces.

You are afforded the same extension time as military personnel, that is 180 days after you return. You should also read the first url about excluding some of your income. The military are receiving a special exclusion that none of their combat pay is taxable; however, civilian contractors fall under the foreign income exclusion which is $80,000 per year.

Be safe, D