By AccountingWEB Staff
If you have clients who want information about e-filing, you can pass this article along to them. We hope you'll find it helpful.
As April 17 – this year's tax deadline – is quickly approaching, are you ready to file? If not, you can still get an extension as long as you request it by the deadline. That provides an automatic six-month extension to get your tax return ready. Keep in mind, the additional six months is to file your taxes, not to pay your tax bill. If you owe money, you're still expected to pay by the April 17 deadline.
Even if you're unable to pay what you owe, you can at least avoid a failure-to-file penalty by getting an extension. The easiest, quickest way to get an extension is to e-file. It's convenient and secure, and you can do it from your home computer, possibly for free using the Free File feature on the IRS website. Taxpayers earning $57,000 or less (adjusted gross income) can file for free. Fillable forms can be filed for free regardless of income. Obtain Form 4868, Application for Automatic Extension of Time, on the IRS website. Fill it out online, or you can print the form, fill it out, and mail it to the IRS at the address provided at the bottom of the form. Or, ask your tax professional to e-file an extension for you.
What will you need?
To file Form 4868 by e-file or mail, you must:
- Provide your Social Security number and your filing status.
- Estimate the taxes due in order to ensure you have paid in enough, or make an additional payment by the deadline. You'll need your 2010 tax return, which, unless you saw drastic changes between 2010 and 2011, should help you estimate what your 2011 taxable income might be. Also have your 2011 W-2s and 1099s or other proof of income. If your estimate is ultimately less than the amount you owe, the IRS will add a late payment penalty. Tax wisdom says it's better to overestimate your tax bill and get a small refund than to risk a penalty.
- If you owe taxes, be prepared to make a payment online through the secure website of the e-file provider. You can also mail your tax payment (make the check payable to the United States Treasury – not the IRS), or you can pay by phone with a credit or debit card no later than the deadline.
Once you have the information you need, go to the IRS website. On the right side of the page, click on "e-file" or "Free File." If you select Free File, you'll see the "Choose a Free File Option", which provides information to help you find a Free File company that will best meet your needs. Once you've chosen a company, follow its directions.
Extending your state return
Don't make the mistake of assuming that when you extend your federal return, your state return is automatically extended as well. Most states have the same tax filing deadline as the federal deadline, so don't overlook this important step. That's why, whether you choose an e-file provider or a Free File provider, it's important to find one that deals with your state. Before you finish e-filing your federal extension, look for an icon that offers to let you file your state extension. For example, if you're using the TurboTax Freedom Edition to Free File or e-file your extension, after you have submitted your federal extension, a page will appear with an icon that says "Check with your state." After selecting this option and the state you wish to extend, instructions will appear to help you file the necessary forms.
What if you can't pay the taxes you owe?
The IRS thoroughly explains all your options on its Topic 202 – Tax Payment Options website page.