| You may think it is strange why many taxpayers file | | | | question remains: should I file now and amend your tax |
| tax extensions even though the IRS requires that your | | | | return later on should I file a tax extension? |
| tax liability is paid on April 15th. It would seem logical | | | | Why Filing a Tax Extension is Logical |
| that if you have to pay taxes on April 15th anyway, | | | | In most cases, filing an extension is better than |
| then why not also file your tax return? You may be | | | | amending it later. For instance, when you file an |
| shocked at what you read below but filing a tax | | | | extension you can still do it electronically whereas an |
| extension can actually make a lot of sense. | | | | amended return requires paper filing and takes longer |
| Scenario 1 - Supporting Documentation Complete | | | | for a tax refund to be processed. An amended return |
| If you have your supporting documentation and | | | | is also more likely to raise a red flag from an audit |
| bookkeeping complete and are comfortable that you | | | | perspective than filing a tax extension. |
| claimed all the right tax credits and deductions then by | | | | You Should Still File Even If You Can't Pay Your |
| all means you should file your tax return now. | | | | Taxes |
| Scenario 2 - Bookkeeping Incomplete & Need to | | | | Let's suppose that you don't have the money to pay |
| Review Tax Credits | | | | your taxes right now. You should still file your tax |
| But, what if you have not completed your bookkeeping | | | | return or tax extension and pay what you can now. |
| and/or need to investigate further about taking certain | | | | The IRS charges you interest and penalties for failure |
| tax credits and deductions? If this is the case, then | | | | to pay your taxes on the due date and you are |
| your options are to either file now and make changes | | | | required by law to file a tax return unless you are tax |
| later by filing an amended tax return or just file a tax | | | | exempt. |
| extension now & pay an estimated tax liability. So, the | | | | |