WHAT IS A "TAX EXTENSION?"

FREQUENTLY ASKED QUESTIONS

What does filing an "extension" do?

A tax extension is a formal request to the IRS to delay filing your federal tax return, typically until October 15th.   Filing an extension grants you additional time to submit your complete and accurate return, but the extension does not extend the time for paying any taxes due.  Your estimated tax due should be paid by April 15th, and we will help compute this payment when you provide us with your initial tax information.  The extension payment is an estimated payment that will be applied to your IRS account, with any over or underpayment settled up when your return is filed.

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Why would my tax preparer suggest we file an extension?

We may advise an extension due to complex return details, pending receipt of essential documents, documents received close to the filing deadline, and changes in tax legislation impacting a return.  We request that clients provide us with as much of their tax information by March 1st so that we can complete as many returns by the initial tax deadline (normally April 15th) as possible.

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Am I more likely to be audited if I file an extension?

Requesting an extension does not inherently increase the risk of an IRS audit. Filing a thorough and accurate return is more important than meeting the initial deadline.

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What are the advantages of filing an extension?

Filing an extension allows for additional time to gather required documents, potentially decreases the chance of errors in the return, and offers more time for strategic financial or retirement planning.  Certain tax deductions for the year align with the tax extension timeline, such as getting an extra six (6) months to fund business retirement plan contributions.  It is also easier and cheaper to file an extension than to file an amended tax return.

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Should I do anything differently if I am filing an extension?

In short, not really.  Please provide all available tax documents you have, particularly any W-2s, 1099s, K-1s, and information regarding deductions (such as mortgage interest and donations), as early as possible.  These documents will help us prepare your extension and see if making a tax payment with your extension is necessary.  We can then help facilitate your tax payment or provide you with the information to make the payment to the IRS yourself.

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As you receive your additional tax documents, please upload them to our portal and contact our tax team when you believe you have provided all your necessary information.  We will then review your documents and let you know if we need anything else to complete your tax return.

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How can I avoid filing an extension?

To minimize the need for extensions, provide all known tax documents to our firm (via ShareFile) as soon as you have received the majority of them, enabling us to prepare a preliminary return and alert you to any missing information and/or questions that may arise.

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Some clients will always need to file extensions due to size and complexity of their tax returns, as well as waiting for final documents from businesses and investment funds.  Please communicate with us if you know certain documents are delayed.

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Have there been any changes to the due dates of returns for 2023-2024?

There are no specific changes to the standard return due dates, but taxpayers affected by certain disasters may have different filing deadlines as specified by the IRS.  Here is more information on tax relief in disaster situations.