ROCHESTER, N.Y. (WROC) — CPA Michelle Staebell said it’s important for tax filers to know they can file for an extension from the IRS if they need additional time.
Staebell discussed the process Monday during News 8 at Sunrise.
“A lot of people don’t realize that anyone can file an extension,” said Staebell. “Maybe you have family situations going on that makes it so you can’t get all your paperwork together. Maybe your paperwork is delayed. Maybe you’re out of the country. There’s a ton of reasons why people might want to file for an extension, so knowing that’s an option, that could be really helpful and less stressing out in tax season.”
Staebell said tax filers do not need to seek permission for an extension. “It’s an automatic extension. It’s an easy form that has to be filed. The 4868 for Federal, and then New York has its own extension which is the IT-370. They are basic forms – name, address, Social Security number, and that’s about it. Electronically or on paper, it’s really easy to file for extensions.”
There’s plenty of reason to file your tax return on time by April 15. First, if you’re due a refund, you don’t get the money until you file and your return is processed by the IRS. Second, if you owe money, you still need to pay what you owe by April 15. “The extension is just time to file the actual accurate tax return,” noted Staebell. “Somebody needs to know their situation well enough to send in any tax due by April 15, and then figure out the paperwork later.”
Be prepared to pay up if you fail to file your tax return on time without an extension from the IRS. “Nobody wants to pay penalties, and they can be high,” Staebell said. “The failure to file penalty, if somebody doesn’t file a return or extension, can be 5 percent of unpaid tax per month. And then the failure to pay penalty is less severe at 0.5 percent. So you definitely want to make sure that extension is filed to avoid that high, 5 percent per month penalty.”
Staebell said if you fail to your return for two years without an extension, you will forfeit any money you’re owed by the government.
In addition, she said there is no reason to be fearful of what filing for an extension might trigger. “You’re not going to get audited. There’s no risk of the IRS coming back and saying – we’re going to audit you for this. So it’s an option. Please don’t stress about getting your return done by 4-15 if it’s going to add undue stress to your situation. Know that there are options.”
For more information on this subject, Staebell said to consult a trusted CPA.