How to File a Tax Extension in 2024

What Is a Tax Extension?
How Does a Tax Extension Work?
How Do I File a Tax Extension?
When Should You File a Tax Extension?
What’s the Penalty for Not Filing My Taxes on Time?
What’s the Penalty for Not Paying My Taxes on Time?
Having Trouble Doing Your Taxes?

So, you got your W-2 and a few other statements in February and thought, Meh, I’ll do my taxes later. Or maybe you put off doing your taxes because you were missing an important document. March flew by and, before you knew it, Tax Day was looming.

If that’s you, you might need to file a tax extension. Not sure what that even means or how it works? Don’t worry. We’ve got the full scoop on everything you need to know about tax extensions.

 

Simply put, a tax extension gives you six extra months to file your taxes. So, instead of your tax return being due on Tax Day (for 2024, that’s April 15), it’ll be due October 15.¹ Just in time for a pumpkin spice latte (okay, let’s face it—pumpkin spice everything).

And there’s more good news: Filing a tax extension is free! It just takes a little bit of time to fill out the form to request an extension.

Fair warning, though: You might be thinking that an extension will give you six extra months to pay your taxes, but unfortunately that’s not the case. An extension might be free, but it does not buy you more time to pay if you owe Uncle Sam. Bummer!

But even if you can’t pay a dime of your taxes by Tax Day, you should still file an extension. The penalty for not filing your taxes is a lot more severe than filing and paying late.

So don’t get discouraged and procrastinate on this or ignore it altogether. Pay as much of your bill as you can, and if you still can’t afford to pay your tax bill after six months, look into setting up a payment plan with the IRS.

A tax extension does one simple thing—it pushes out your filing deadline. And that can be super helpful if April 15 is coming at you faster than a speeding bullet and you’re still waiting on tax documents or just haven’t been able to file yet.

Now, if you owe taxes, they’re still due on Tax Day . . . even with an extension. And if you don’t pay by the original tax filing deadline, you’ll rack up late-payment penalties (0.5% of your tax bill each month, up to a maximum penalty of 25%) and interest.² Yikes!

But filing an extension can help you avoid the big failure-to-file penalty, which is 5% of your unpaid tax bill every month, up to a max of 25%.³ That’s why it’s always best to file an extension, even if you know you can’t pay by Tax Day.

Don’t settle for tax software with hidden fees or agendas. Use one that’s on your side—Ramsey SmartTax.

What if you don’t owe taxes and the IRS owes you a refund? In that case, you don’t have to file an extension because there won’t be any penalty for failing to file your tax return (no tax bill, no failure-to-file penalty).

But if you wait too long to file, you run the risk of missing out on your refund altogether, so yeah—file your tax return. Even if you don’t think you owe anything.

Here’s the deal, folks—if you’re going through the hassle of trying to figure out your tax liability and how much you’ve already paid for Form 4868, you might as well just go ahead and file your tax return. It probably won’t take as long as you think it will, and then you won’t have to worry about it anymore!

So, all you have to do to file an extension on your 2024 tax return is fill out Form 4868 and file it by Tax Day, which falls on April 15 this year.⁴ You can file it online or by good old snail mail.

Form 4868 is pretty simple to fill out, especially for a tax form. Here is some of the information you’ll need:

• Your name, address and Social Security number.
• Your estimated tax liability (how much federal taxes you owe).
• How much in federal taxes you’ve paid already (you can find that on your W-2). You need to report this info so you can make a tax payment to the IRS when you file your extension.

Okay, there are two ways you can file Form 4868:

1. File your tax extension online.

The IRS allows you to e-file an extension through the IRS website. Or you can file an extension with your tax software. If you want easy-to-use tax software with no hidden fees, check out Ramsey SmartTax.

If you owe taxes and make a full or partial payment online, you’ll get an automatic extension without having to fill out Form 4868. But you still have to file your tax return eventually.

1. File your tax extension by mail.

Like the taste of licking stamps and envelopes? You can download Form 4868 from the IRS website, fill it out, and snail mail it to the IRS by Tax Day, along with a check or money order for your tax bill.

But snail is the key word to remember here. If you want even a reasonably fast response from Uncle Sam, just go online for your extension request.

Now, let’s be clear. If your tax situation is pretty simple and you’re just feeling lazy, get your butt off the couch and do your taxes! Better yet—grab a laptop and do your taxes from your favorite spot on your couch.

Otherwise, here are some situations where it’s okay to file an extension:

1. You don’t have the documents you need.

Are you missing your W-2, 1099, or other important documents? In that case, file for an extension, gather those documents, and do your taxes.

2. You go through an unexpected life event.

Life doesn’t stop for taxes. If you experience a traumatic life event like a death or illness, don’t push yourself to finish your taxes. File for an extension, focus on your life, and do your taxes later. Just don’t forget about them!

3. Your tax situation is really complicated, and you just need more time.

Itemizing tax deductions or owning a small business can make your tax filing really difficult. In that case, pushing the deadline to October can prevent you from rushing through your taxes and making dumb mistakes.

But listen: If your tax situation is that complicated, you should work with a pro. What may take you days or weeks to do can take a pro far less time. 

When it comes to late penalties for not filing your taxes, you could be in one of two scenarios:

Are you expecting a refund?

If you’re expecting a refund, you won’t get a penalty for filing late. You just won’t get your tax refund until you file. The IRS will hold onto your money for up to three years.⁵ What happens after three years? The IRS pockets the cash.

Do you owe taxes?

Failing to file an extension could cost you a pretty penny if you owe taxes. For every month (or partial month) you don’t file your return, you’ll pay an additional 5% of what you owe up to 25%.⁶

For example, let’s say you owe $1,000, and miss the April 15 deadline, and don’t file an extension. You finally get around to filing your taxes on June 15. Your failure-to-file penalty would be $100 ($1,000 x 5% per month). You’ll also owe interest (currently 4% per year) on your bill.⁷

Let’s say you file an extension, but you can’t pay all your tax bill. The late payment penalty is much less severe than the failure-to-file penalty. Instead of paying 5% every month, you’ll pay 0.5% per month up to a maximum of 25%. You’ll also pay 4% interest.⁸  

Let’s go back to our example above. Say you owe $1,000, but this time you file an extension. By June 15, your penalty would be $10 ($1,000 x 1%), plus interest.

Here’s the thing: Getting a tax extension doesn’t solve your initial problem—getting your taxes filed.

If you don’t think you’ll be able to get your taxes together in time, talk with a RamseyTrusted tax pro. These tax experts have years of experience and, believe it or not, they love this stuff. They can help you file an extension or go ahead and file your tax return.

If your taxes are pretty straightforward and you want an easy-to-use tax software that can give you some peace of mind, check out Ramsey SmartTax! No hidden fees, no advertisements, no games. That’s how it should be!