Did the April 15th deadline for filing your federal tax returns sneak up on you? Unable to file on time? Or have you been well aware of the fast approaching deadline but for whatever reason, are unable to pay your federal taxes?
Many taxpayers facing these situations simply “file for an extension.”
However, there are differences between being unable to file on time and being unable to pay on time, and these differences may unnecessarily cost you money.
While the IRS imposes penalties for both late filing and late payment, the penalty for late filing is higher then that for late payment. If you complete your tax return but can’t pay the taxes you owe, do not request an extension. Instead, file your return on time and pay as much as you can.
Also remember that an extension to file will give you six more months to file your taxes but it does not give you extra time to pay your taxes. You still must estimate and pay what you owe by April 15. You will be charged interest on any amount not paid by the deadline and may also owe a penalty for not paying on time.