Welcome to the Tax Insights Podcast, where we break down complex tax topics into bite-sized how-tos. In this episode of Tax Insights Podcast, Jeff Dvorachek explores the world of tax deadlines and extensions. Listen to the new podcast below!
In this episode of Tax Insights, Jeff explores the world of tax deadlines and extensions. As Tax Day approaches, Jeff provides insight into the current state of affairs. Join us as he breaks down the process of filing extensions, discusses potential penalties, and addresses what happens if you can’t pay your taxes on time. Let’s get started!
Jeff: You know, I think we’re going to make it. We’ll see what happens. We’ve got it all in a week and a half left, so we’ll just keep plugging away, right?
Host: How has it been going this year overall?
Jeff: It’s been really busy. The nice thing is, there hasn’t been a ton of tax law changes like there has been in the past. Sure. We’ve pretty much been able to kind of do status quo. Now that doesn’t make the workload any less, I guess, from what it feels like at this point, but less changes to be working through with each return.
Host: Hey, speaking of returns, let’s talk about what happens if a listener does not get their taxes done in time by April 15th. Walk us through what happens. Can you file for an extension? Is there penalties for that? Help us out.
Jeff: Sure. You know, so there’s times when people are going to need to file extensions and, you know, we’ve talked about that in the past. You know, maybe they have a partnership and that partnership hasn’t given them all the information that they need to file their return. Or maybe they’re just waiting for some things that maybe didn’t come in the mail that they were expecting a social security statement or something like that. So definitely, if you don’t have your return done or aren’t able to get your return done by April 15th, doing the extension is really important. You just, you don’t want to file a return late. You definitely want to do that extension.
Host: Is there a penalty? Is there a fee to file an extension? How do you go about filing for an extension?
Jeff: Yeah. The extension is actually really easy to file. It’s just filing one form, basically just checking a couple of boxes and letting the IRS know that, Hey, I’m going to need more time. And that extension gives you until October 15th.
Host: Oh my gosh. You’re actually turning. Oh my gosh. So like, do you automatically get guaranteed that extension? I mean, like, can they ever come back and say, no, you don’t qualify?
Jeff: Yeah, I think the IRS has pretty much made the or had the conclusion that any extensions will be granted as long as it’s done by October 15th. But the more important part is just because you have time to file or extended time to file your return doesn’t mean you have an extended time to pay your tax. So if you have tax due, that’s still due on April 15th. But how do you know if you owe taxes if you haven’t finished your all your forms yet? So how does that work? That doesn’t make sense.
Host: Yeah, you have to work through it the best way that you can. And you know, sometimes it makes sense to paint a little bit more than you think you’re going to need to just because then you can always get that refunded because, you know, if you don’t file your, your, or you don’t pay your tax by April 15th, the IRS will give you some interest and maybe late payment penalties.
Host: So filing an extension does not necessarily mean that you are just delaying your payment if you owe taxes.
Jeff: That is correct. 100% correct.
Host: So let me ask you this then what if a listener up there owes for their taxes and they cannot pay it by April 15th?
Jeff: Sure, and that would be whether they’re going to file an extension or whether they just can’t pay, right? So we always suggest in that point is pay as much as you can. And then the IRS will send you a letter with the amount that you still owe with, you know, some penalties and interest, of course, because it is paid late. But on that letter, they’re also going to give you options to be able to pay that over like an installment type plan.
Host: Jeff, great information for our listeners. Time is running out. How do we connect with you over at Hawkins Ash?
Jeff: I would go right to our website, which is Hawkins Ash.CPA and go to that CPA-HQ section.
