The last date to file your tax 2018 is 15th April 2019. However, there may be people who want a tax extension. If you are unable to file yours before 15th of April 2019, then there is no need to panic. It is easy to get an extension. Here is your simple guide to get one.
Tax 2018: How to request a tax extension?
If you are unable to fill your tax 2018 before the deadline, you can request for a tax extension. One can do so by filing Form 4868. This form has to be submitted to the IRS. Moreover, the submission has to take place before 15th April 2019.
By doing so, one will get the extension until 15th of October, 2019.
However, for getting an extension on state returns, this will not help. For that, one will have to fill a different form. The details for that has to be checked with the respective state tax authority.
How does the extension work?
A tax extension only gives more time to file the taxes. However, this does not mean that one will get more time to pay those taxes. This is in case if one owes taxes.
All the tax outstanding has to be paid before the 15th of April 2019. The government will charge you a penalty. This will be on a monthly basis and until the balance is paid off. And it will happen only if one fails to pay the outstanding.
Moreover, filing the tax extension will not free one from the penalty. However, it can for sure reduce the amount.
For penalty, the government charges the rate of 5 percent. This is on the total amount that is owed by the person. Moreover, the maximum penalty is of 25 percent.
Also, there is a 0.5 percent penalty for failing to pay the taxes. This is also on a monthly basis. The maximum penalty here as well as 25 percent.
However, if one fails to file then the “Fail to File” penalty drops to 4.5 percent. This is on a monthly basis. It’s so done so that the balance does not become more than 5 percent. One still pays 0.5 percent “Failure to pay” penalty. However, this is if the tax extension has been filed. And one will not have to worry about the 5 percent failure to file penalty. But this is only until the deadline of 15th October is not missed.