Updated for tax years 2023 and 2024.
If you need more time to file your taxes, you’re in luck — thankfully, the Internal Revenue Service (IRS) allows taxpayers to file a tax extension. An extension gives you an extra six months to complete your federal tax return, pushing the new tax deadline to Oct. 15. And while filing an IRS extension doesn’t prevent you from having to pay your tax bill by the deadline, there are a few reasons why it may be the right choice for you.
Take a look at the top reasons why you should consider filing a tax extension this year.
1. You don’t have all your tax forms and financial information yet.
An extension request is a good idea if you are still waiting on certain tax documents. For example, maybe you are a small business owner, and you’re still working on the books. Or you could be waiting for a letter confirming a charitable contribution. You may even still need the basis of the stock you sold or a specific document from a financial institution. If you’re waiting on information critical to helping you file your return accurately, it’s likely best to wait to file until you have that information.
2. A partnership or other organization hasn’t sent out forms.
If you are a partner in a business and are waiting to receive your Schedule K-1, it’s perfectly fine to file a tax extension and wait to receive that document. Check out our Guide to Filing a Business Tax Extension for answers to common questions about the process.
3. You have an emergency that prevents you from completing your return.
Unexpected hospitalization or long-term illness, a family emergency, or just crunch time at work can make it difficult to finish your return. No worries. Give yourself a little more time for this important financial task by requesting an extension.
4. You need more time to make contributions or change a retirement plan.
If you are considering funding a retirement plan or starting a new one for the next tax year, you may want to file an extension so you have more time to complete that task. Contributions to a traditional IRA are tax-deductible, which you can claim on your tax return to reduce your taxable income. Just remember, you must make that decision by the April 15 filing deadline.
5. You want to make elections on your return but won’t know which election is best until later.
If you have losses you can carry back to prior years, you may not know until later in the current year if that’s a good idea or if you should use the losses on a future tax return. In this case, a tax extension may be helpful.
6. You’re seeking clarity on your tax liability.
Using a reliable tax calculator can help you better understand your tax liability before submitting your tax return. If you need more time to work on your taxes, filing a tax extension will give you extra time to use advanced tax calculation tools. This will allow you to consider different scenarios and make better financial decisions.
Whether you are evaluating potential deductions, estimating credits, or assessing the impact of different financial decisions, a tax calculator can provide valuable insights. Incorporating this tool into your tax planning process allows you to make informed decisions aligned with your financial goals and helps ensure accuracy when filing your taxes.
How to file a tax extension for free in TaxAct®
Thankfully, the IRS doesn’t charge a fee to request an extension. When you file with us, follow the Q&A steps in our tax preparation software to complete IRS Form 4868 to file an extension. You can estimate your information if necessary.
Step 1: Log into your return and click the Filing tab.
Step 2: Select File Extension.
Step 3: Continue the interview process to enter all the appropriate information and file an extension.
Remember, filing an extension doesn’t give you extra time to pay your tax bill — that’s still due by April 15. If you want help estimating your tax due, click the Estimate My Tax button within the steps to file an extension. If you’d like to simply move forward with completing the form, select Complete Form 4868 and insert your information as prompted.
You can then print or e-file Form 4868, Application for Automatic Extension of Time To File U.S. Individual Income Tax Return, as well as the necessary state forms.
Be sure to make a payment with your tax extension if you estimate you will owe more tax.