Tax Edge

Taxpayers who need more time to complete their returns should submit their requests for an automatic extension electronically by April 15, the Internal Revenue Service urged today.

This year, anyone, regardless of income, can e-file their extensions at no cost from a home computer using IRS traditional FreeFile or FreeFile Fillable Forms. E-filing an extension request using either form of FreeFile is convenient, safe and secure, and taxpayers receive confirmation to keep with their records.

The IRS expects to receive 1.9 million extension requests electronically this year. A total of almost 10 million extension requests are expected during 2009 compared with 9.5 million extensions received during 2008.

The automatic extension gives a taxpayer until Oct. 15 to file the tax return. Remember, though, an extension does not give the taxpayer an extension of time to pay. Those who owe taxes can make a payment when they file the extension either by mailing a check or by an electronic payment, such as an electronic funds withdrawal from a bank account or a credit card payment. The payment must be made by April 15 in order to avoid late payment penalties and interest.

A taxpayer can get an automatic six-month extension of time to file an income tax return by filing Form 4868, Automatic Extension of Time to File. You can e-file the extension from a home computer or through a tax professional who uses e-file.

Some taxpayers can wait until after April 15 to file a return, pay any taxes due and make IRA contributions for 2008. As a general rule, those eligible can get the extra time without having to ask for it. Eligible taxpayers include:

• Members of the military serving in Iraq, Afghanistan or other combat zone localities. Normally, the postponement is until at least 180 days after the service member leaves the combat zone.
• Victims of severe flooding in Minnesota and North Dakota have an extra 30 days, until May 15, to file their 2008 individual tax returns and pay any taxes due. Similarly, victims of severe storms and tornadoes in three Oklahoma counties have until May 11 to file and pay.

Statistics for the 2009 filing season indicate that more taxpayers are filing their returns electronically than ever before. By Friday, April 3, 2009, nearly 71 million individual tax returns (out of over 92 million in total) were filed electronically so far this year.

Posted April 27, 2009.