By Charlestien Harris
While the 2023 tax season deadline has come and gone, some of you may have filed tax extensions for various reasons. It is now time for those extended tax filings to be submitted to the Internal Revenue Service; the tax extension deadline is October 17. According to the Internal Revenue Service, this year saw an estimated all-time high of 19 million taxpayers opting for an extension.
As the deadline approaches, many tax filers who did not file in April might find themselves in a rush to prepare their returns and may have questions, especially if they are first-time extension seekers. Here are some tips to help you prepare your tax return extension and avoid common last-minute mistakes:
Check your federal tax extension status: If you sent your extension on time, it should be granted, but it’s advisable to confirm your approval with the IRS. If you used the U.S. mail for your extension, contact the IRS customer service number (800-829-1040) to check the status, as this information isn’t available on the IRS website.
Remember to pay any tax due: The standard tax extension allows you to file your tax return after the deadline but does not extend the time to pay any taxes owed. Failure to pay by the filing deadline results in penalties and interest. Pay as much as you can, as penalties are calculated at 0.5 percent of the unpaid tax balance per month, with a maximum of 25 percent of the unpaid tax.
Be aware that tax extensions are not guaranteed: Some extension requests are rejected due to errors on the extension form or outdated information. If rejected, the IRS provides a short window to correct errors and refile.
Don’t forget your extension deadline: Missing the extension deadline can result in a 5 percent penalty for filing taxes late. If your return is more than 60 days late, you may also face additional penalties. The IRS might waive the penalty if you provide a reasonable explanation for filing late.
File your tax extension electronically if possible: The IRS encourages electronic filing, especially considering the approaching deadline. Electronic filing is fast, accurate, and secure. If you are due for a refund, choosing direct deposit expedites the refund process.
With the deadline quickly approaching, gather your documents, consult a professional if needed, and file electronically to expedite the process. Don’t risk making significant mistakes or missing deductions due to rushing to meet the filing deadline. Remember, filing for an extension is common, and the IRS is accustomed to handling numerous extension requests.
For more information on this topic or other financial matters, feel free to contact me at Charlestien.Harris@banksouthern.com or call me at 662-624-5776.
Until next week – stay financially fit!
Charlestien Harris is a financial contributor to DeSoto County News. She is a financial expert with Southern Bancorp Community Partners whose articles are seen in a number of publications around the region. You’ll be seeing her columns weekly on the DeSoto County News website and our social media channels.