(a) The first step is to obtain an IRS Form 4868 that will automatically extend the deadline to file your income tax return. You may download the form directly from the IRS website (IRS.gov).
(b) The Form 4868 is completed as a worksheet where you fill in your personal information, estimated tax liability, any tax payment you made throughout the year and the income tax balance due. The good part is you don’t have to explain why you’re asking for an extension.
(c) The Form 4868 needs to be submitted before April 15 to be eligible for extension. Therefore, make sure you submit it electronically through the tax preparation software you use or the any free E-Filer service. If you don’t have a free E-Filer service, you may visit the IRS website and search for a “free file”.
(d) One thing you should be very careful with is that filing a tax return extension electronically does not grant you additional time to pay your taxes. You have to pay your taxes by due deadline on April 15. Therefore, calculate your income tax balance due and make full payment of this amount along with the tax return extension to avoid interest and penalties. Some people make partial payment of their income tax balance, but this only reduces the penalty on their outstanding balance. In particular, if you don’t file by April 15, the penalty ranges from 5% to 25% of the balance due. And if you fail to pay in full, the penalty is 0.5% per month plus interest rate charges. So, by all means, it is to your best interest to file an extension and pay your income tax balance in full.
(e) Payments can be made through credit card, electronic fund transfer or check. Link2Gov and Official Payments are two IRS-approved credit card services that charge 2.49% convenience fees for offering extension payments. Moreover, you can specify a checking account through the IRS E-File page for electronic fund transfer. You can also make your payment over the phone.
(f) The last step is to submit the Form 4868 electronically. However, before you do that make sure that your case doesn’t fall under the special rules. For example, if you live outside the US, if you are out of the US when the 6-month extension expires or if you serve in a combat zone or a qualified hazardous duty area, you need to contact IRS for specifications.
