This Startup Tax Extension Guide provides important information about IRS tax extensions and how they can benefit businesses struggling to meet the federal filing deadline. The guide explains that an IRS tax extension gives taxpayers an additional six months to file their returns, although it does not extend the payment due date. Due to the pandemic, the federal government extended its tax deadline from April to July last year, with approved extensions pushing the due date back even further. The process for filing a tax extension is largely automatic and can be completed online or by mail before the April 15 deadline. As long as the correct form is filed on time and the information listed on it is accurate, the IRS is unlikely to reject the extension request. For small businesses, IRS Form 7004 is the required form for this process.
Introduction
From Business News Daily Staff By Andrew Martins
Understanding IRS Tax Extensions
Preparing your business’s tax return takes time. For some, it may be hard to meet the federal filing date. The IRS has a mechanism in place to extend the deadline.
What is an IRS Tax Extension?
An IRS tax extension is a way for the federal taxation agency to give taxpayers more time to file their returns. While the federal Tax Day falls on April 15, unless it lands on a weekend or legal holiday, a tax extension pushes the due date back six months. Though that extension affords taxpayers more time to file their paperwork, Mark Puzdrak, a CPA and partner at Puzdrak CPA, said that doesn’t provide a payment extension.
COVID-19 and IRS Tax Extensions
Due to the pandemic, the federal government pushed back its tax deadline from April to July last year. Those extensions were for 2019 tax returns, with approved extensions getting pushed back even further from July to October.
How do you file an IRS Tax Extension?
When filing for a tax extension, the process is largely automatic. Small business owners (and regular taxpayers alike) can fill out and remit an extension form to the IRS either online through a dedicated tax software program or by mail before the April 15 deadline. All taxpayers are eligible for such an extension if they need it, with no restrictions or limitations when doing so.
When should you file a Tax Extension?
Considerations for filing your tax extension need to be made before the April 15 filing deadline. Failing to do so could lead to problems with the IRS, as you will miss the deadline and be subject to a late filing penalty.
Can the IRS reject an Extension?
As long as the correct form is filed on time and the information listed on it is accurate, there’s very little reason for the IRS to deny an extension. Most extension requests are approved by the IRS, but errors tend to be the most common reason that they don’t get approved.
Which Tax Extension Form should you use?
For small businesses, including partnerships, multimember LLCs, corporations, S corporations, IRS Form 7004 is the form you will need.
Question & Answer
What is an IRS Tax Extension?
An IRS tax extension is a way for the federal taxation agency to give taxpayers more time to file their returns. It extends the due date by six months.
How do you file an IRS Tax Extension?
When filing for a tax extension, the process is largely automatic. Small business owners can fill out and submit an extension form to the IRS online or by mail before the April 15 deadline.
When should you file a Tax Extension?
Considerations for filing a tax extension need to be made before the April 15 filing deadline to avoid late filing penalties.
Can the IRS reject an Extension?
If the correct form is filed on time with accurate information, the IRS is unlikely to reject the extension request. Most extension requests are approved by the IRS.
Which Tax Extension Form should you use?
For small businesses, including partnerships, multimember LLCs, corporations, S corporations, IRS Form 7004 is the required form for filing a tax extension.
