If my client is unable to file their income tax return by the due date, I advice them to request an extension of time to file their return. Individual taxpayers can request an automatic extension of time to file by filing IRS Form 4868, Application for Automatic Extension of Time to File U.S. Individual Income Tax Return, by the original due date of the return. The automatic extension will give the taxpayer an additional six months to file their income tax return.
It is important to note that an extension of time to file does not extend the time to pay any taxes due. Taxpayers who owe taxes must still pay by the original due date of the return to avoid penalties and interest.
Taxpayers who cannot pay their taxes by the original due date of the return can also request an extension of time to pay. Taxpayers can request an extension of time to pay by contacting the IRS and setting up a payment plan.
It is always recommended that taxpayers consult with a certified public accountant or tax professional for specific advice related to their individual tax situation.
Extension request to file a corporate income tax return:
To request an extension of time to file a corporate income tax return in the United States, the corporation should file IRS Form 7004, Application for Automatic Extension of Time To File Certain Business Income Tax, Information, and Other Returns.
The extension request can be filed electronically, or you can complete the form and mail it to IRS. RKB Accounting provides services to file your extension request electronically in most of the situations.
Form 7004 must be filed by the original due date of the corporate income tax return, which is typically the 15th day of the fourth month after the year-end with an exception if you have the year-end as June 30th in which case your due date is Sep 15th. The automatic extension will give the corporation an additional six months to file its income tax return, which means the new deadline will be 6 months after the due date and 7 months after the due date if your corporate year-end is June 30th.
To complete Form 7004, the corporation will need to provide basic information such as its name, address, and tax identification number. The form also requires an estimate of the corporation’s total tax liability for the year, as well as any payments already made toward that liability.
It is important to note that an extension of time to file does not extend the time to pay any taxes due. Corporations must still pay any taxes owed by the original due date of the return to avoid penalties and interest.
If a corporation cannot pay its taxes by the original due date, it may be able to request an extension of time to pay or set up a payment plan with the IRS. It is always recommended that corporations consult with a certified public accountant (USA) or tax professional for specific advice related to their individual tax situation.
Note: You can make only one request in a tax year, whether you are an individual filer or a corporate filer. The maximum extension allowed in only six months or seven months if your corporate year-end is June 30th.
Reference: IRS
RKB Accounting has expertise in cross-border taxation and has been providing accounting and taxation services for the last fifteen years in Canada and USA. RKB services include incorporating a business on both sides of the border, bookkeeping, sales tax, payroll, and corporate and personal income tax. RKB’s expertise includes cross-border tax planning, long-term tax planning, helping business start-ups, business structure planning, and resolving complex tax matters.
Disclaimer: Information in the blog/post/article has been presented for a broad and simple understanding. This is not legal advice. RKB Accounting & Tax Services does not accept any liability for its application in any real situations. You need to contact your accountant or us for further information.