Tax returns tardy? How to file an extension

The IRS clock is ticking.

Long Islanders can avoid penalties by filing their income tax returns by midnight Tuesday.

But those who absolutely can't make the deadline can buy more time by requesting a six-month extension until mid-October.

Filers should keep in mind that the extension is only for paperwork (electronic or otherwise) and not for taxes due.

In other words, filers need to estimate and pay their taxes owed by midnight to avoid penalties  as well as interest on the amount due that isn't paid by the deadline.

Here's advice from the Internal Revenue Service on how to file an extension:

Form 4868, the application to file an extension, can be downloaded as a PDF file https://www.irs.gov/pub/irs-pdf/f4868.pdf or filed by a tax professional, tax software or IRS Free File https://www.irs.gov/filing/free-file-do-your-federal-taxes-for-free, the agency's no-cost tax preparation software.

If a paper 4868 printout is sent in the mail, it needs to be postmarked by midnight. 

The simple nine-section form requires only identification, including Social Security numbers, and an estimate of tax liability.

If even that sounds intimidating, you can skip Form 4868 and simply pay your estimated tax through an electronic IRS service (see below).

The IRS says that "if the indicator is selected when making your payment, you won't have to file a separate extension form and you'll receive a confirmation number for your records."

The IRS accepts direct payments via a bank account https://directpay.irs.gov/directpay/payment or the Electronic Federal Tax Payment System https://www.irs.gov/payments/eftps-the-electronic-federal-tax-payment-system.

The tax agency also accepts payments through digital wallets like PayPal or debit or credit cards https://www.irs.gov/payments/pay-your-taxes-by-debit-or-credit-card.

Need more incentive to file for an extension? Here are two:

The IRS "failure to file penalty" is 5% of the unpaid taxes for each month or part of month that a tax return is late (not to exceed 25% of unpaid taxes).

A separate "failure to pay penalty" is 0.5% of the unpaid taxes for each month or part of month the tax remains unpaid (not to exceed 25% of unpaid taxes). 

If both penalties are applied, the failure to file penalty will be reduced by the amount of the failure to pay penalty.

Plus: the IRS charges interest on penalties.

Tardy tax filers also can file for a New York State extension electronically at https://www8.tax.ny.gov/RPXT/rpxtStart or through tax-filing software programs.  A PDF version for printing out is available at https://www.tax.ny.gov/pdf/current_forms/it/it370_fill_in.pdf.

Instructions for making a payment along with a New York State extension request can be found at: https://www.tax.ny.gov/pit/file/extension_payment_options.htm.

By Ken Schachter

kenneth.schachter@newsday.comkschach

Ken Schachter covers corporate news, including technology and aerospace, and other business topics for Newsday. He has also worked at The Miami Herald and The Jerusalem Post.