One Easy Step to File Your Tax Extension

By Meredith Margrave

It's that time of year again -- your taxes are due.

Whether you've been really busy or it just happened to slip your mind, there's an easy solution if your tax return is not ready to go.

File a tax extension.

Filing a tax extension is free, relatively simple (only one page), and best of all, it gives you six extra months to get that tax return filed. The deadline for filing your taxes this year is April 18, so if you're going to file an extension, you need to do it before that deadline.

What a Tax Extension Does

First things first -- a tax extension gives you extra time to get your paperwork to the IRS, but it doesn't give you more time to pay any taxes that are due. Any amount not paid by the April 18th deadline will start accruing interest, and if your payment isn't at least 90% of the total amount due, the IRS will add on a penalty.

If you've put off filing because you don't have enough money to pay the taxes you owe, file your return on time and pay as much as you can. Inability to pay your taxes in full is not a reason to request an extension since it won't give you any extra time to actually make your payments.

If you're short on your tax payment, don't worry too much. After you've made your partial payment (by April 18th), you'll receive a bill from the IRS for the rest of the amount owed. Even though it doesn’t make sense to file an extension in this case, the IRS does have many avenues to help taxpayers make their payments, and a list can be found at www.IRS.gov.

Requesting an extension is as easy as submitting one simple form -- Tax Form 4868 to be exact. Essentially, it's a rough draft of your tax return. Form 4868 is pretty easy to complete -- and only one page long!

How Do I Fill Out Form 4868?

To complete Form 4868, you must provide:

1) Your name and address,
2) Your social security number,
3) Your spouse's social security number (if you have one),
4) An estimate of your total tax liability for the applicable tax year,
5) Your total tax payments,
6) Your balance due (total tax liability - total tax payments), and
7) The amount you're paying today, if any.

You'll notice that Form 4868 does not have a box asking you to explain why you're asking for an extension. You even have the choice of filing the form by mail, electronically, on your own, or with the help of a tax professional.

If you're filing Form 4868 on your own, you have the option to electronically-file (e-file) through either the IRS web site or a tax software program like TurboTax. If you don't want to e-file, you can download the form here, print it, fill it out, and send it (along with your payment) to the IRS address on the bottom of the form.

If you know someone without access to the internet or a printer, the local IRS office, post office and library will have Form 4868 available. The IRS also has a toll-free phone line available for people filing an extension. The number is 1-800-TAX-FORM (1-800-829-3676).

After you've filed an extension, sit back and relax, but not for too long. The tax extension only pushes the due date back six months, to October 18th. That may seem like a long time now, but procrastination is what got you to this point in the first place.

The bottom line is, you're probably never going to find a time when you want to do your tax return, but it has to be done. If you'd like to read some tips and tricks for filing your 2010 return, see some of our most popular articles, including:

» The Most Important Tax Changes to Know Before Filing Your 2010 Tax Return

» Top Tips for Avoiding an Audit

» 10 Ways to Make Tax Season Less Painful