Tax Planning

The October 17 Tax Extension Deadline Is Almost Here: What You Need to Know

The October 17 Tax Extension Deadline Is Almost Here: What You Need to Know

Life happens and sometimes it’s impossible to get your federal income taxes filed by the traditional April 15 deadline. Fortunately, the IRS provides an extension option that allows American taxpayers to file in the fall instead. 

If you submitted an extension request for your 2021 taxes, it is nearly time to file your return – this year’s deadline is Monday, October 17, 2022. 

Below, you’ll find some helpful tips for ensuring that your taxes are filed on time. 

Should I use IRS Free File?

Although the IRS is currently using some of its $80 billion in additional funding to create a free, government-backed alternative to TurboTax, Intuit, and other popular tax filing programs, the existing version of Free File has certain limitations.

The e-filing portal is only available to taxpayers with an adjusted gross income of under $73,000 in 2021. Using this system is, according to the IRS, the fastest way to receive a refund. 

An IRS Newsroom article from September 2022 notes:

The Free File program gives eligible people an opportunity to file their taxes and claim the 2021 recovery rebate credit, the child tax credit, the earned income tax credit, or other valuable credits they qualify to receive. Taxpayers can also use Free File to claim their remaining child tax credit or any advance payments they did not get in 2021.

Do I also get an extension to pay my taxes?

It is important to remember that being granted an extension to file your tax return is NOT an extension to pay your federal income taxes. 

The IRS shared the following information for filers who applied for a 2021 extension:

  • ​​Generally, there's no penalty for not filing a return if due a refund, but there's also no statute of limitations for assessing and collecting taxes due if no return has been filed.
  • Interest is charged on any tax not paid by the April due date and will accrue until paid in full. Penalties will accrue for each month tax remains unpaid until maxed out at 25% of the unpaid tax.
  • Submitting a tax return and paying the amount owed as soon as possible can help taxpayers avoid further interest and penalties.

What if I can’t afford to pay my taxes?

Financial concerns are among the many reasons people submit extension paperwork to the IRS. If you are unable to pay your 2021 federal income taxes, there are options available to you.

The most popular way to avoid paying taxes in a lump sum is to apply for a self-service payment plan. If your application is approved by the IRS, you will make installment payments online until your tax liability for 2021 is fulfilled. 

The IRS offers taxpayers both short-term and long-term payment options. 

The best way to avoid problems with filing taxes is to work with a qualified tax professional in your area. Whether you need to file an extension, have questions about which tax credits you qualify for, or need assistance understanding your W2 or 1099 forms, a reputable tax expert can assist you not just at tax time but all year long.

Have you filed your 2021 taxes yet?

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Spencer Wilson

Spencer Wilson

Spencer Wilson, EA is a tax preparer based in Long Beach, CA. Spencer Wilson Financial Management Services has been serving the Greater Los Angeles Area and Orange County since 2004. <br /> We began in the heart of Naples in Long Beach and we continue to work hard offering tax preparation and planning, business accounting and bookkeeping and payroll services . <br /> We have helped many different people and businesses succeed financially and take control over their finances.

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