Taxes: file late or file for extension?

Question

I know all the accountants are franticly busy, but I just returned from overseas and haven't filed my taxes. I was wondering if anyone knew which was better, filing an extension, or filing late? There is a $25 extension fee, and filing late seems to be 5% each month on what you owe... I am so confused.. any advise?

Answer 1

I would recommend that you go to the IRS website, http://www.irs.gov and search for Form 4868 (extension form). You can even type the data into their PDF report and print it-cheap and easy! However, an extension of time to file isn't an extension of time to pay. If there's even a remote chance that you're going to owe money, you'll need to get it sent in to the US Department of the Treasury by 4/17/07.

If your income is less than $50,000, you can even use the IRS website to file your return on time. If you're not quite tax savvy, I would recommend a basic TurboTax or TaxCut tax program that runs about $40. Sure, it's a bit of an expense, but the late filing fee is far worse if you owe money.

BTW, if you're getting a refund, filing an extension is strictly a formality-not totally necessary, because penalties are assessed on tax due, not tax liability.

Good luck!

Answer 2

If you never filed 2008, I can't see you having filed any sort of extension by 4/15/2009 when it was due. If you actually had an extension, it might have held the window of opp open until 8/15/2012. Note, if the IRS believed you owed money for 2008, filing even if you can't get a refund is worthwhile--at least you can convince the IRS you don't owe.

Answer 3

File the extension! There is NO $25.00 fee for filing an extension; no idea where you got that information from!

If you owe any taxes, filing the extension will avoid the penalty for late filing at least though you will still have penalties and interest for late payment.

If you think that you might owe, make a gut-shot estimate and include it with the Form 4868. That will avoid ALL penalties and interest if you estimate high enough.

Answer 4

I work for a very large tax preparation company and I will tell you this:

If you owe on taxes, FILE AND PAY NOW.

Extensions are an extension to FILE not an extension to PAY.

If you owe and for some reason can't file, pay now, get an extension, and then file later. The extension will alleviate any "Failure to File" penalties.

You will not be penalized if you are receiving a refund. You can honestly file that whenever.

If you elect to e-file and pay, you just need to mail in the payment vouchers or pay electronically.

If you elect to paper file and pay, you need to mail in the entire prepared return, and payment vouchers.

Good luck!

Answer 5

File for an extension but if you owe, file on or before the 17th. Here are some free tools:
IRS Tax Preparation & E-File Tax Extension Forms Online - IRS.comE-file and tax preparation help at IRS.com—get tax help, info about IRS taxes, fast refunds, filing tax extensions online with the Internal Revenue Service ...
www.irs.com/ - 25k -
E-File Taxes For Free
www.TaxACT.com Do Your Taxes Totally Free This Year. TaxACT is Fast, Easy & Free.

Answer 6

You can now file using turbotax online and bbe on time. There are no fees for filing an extension, but you will have to submit an taxes owed with the extension. Meaning that you will have had to compute your return. However, better filing late if you don't have the time.

Answer 7

without a doubt, file the extension and pay whatever fee they are asking...even if you are getting a refund and don't owe - because the penalties for not filing on time are going to be much more than the fee for extension

Answer 8

If you believe you're going to get a refund, just file late. There are no consequences. If you believe you owe, you should file an extension to avoid paying penalties when you do file.

Answer 9

extension or be very sorry its now a crime to file late