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The Tax Deadline Is Approaching: How to File a Tax Extension Quickly

Tax avoiders, beware: the April 18 deadline is only nine days away. The Internal Revenue Service (IRS) has already issued over 63 million tax refunds to Americans, with an average payout of $3,226.

Don’t worry if you can’t finish and file your tax return by April 18. You can get additional six months to complete your taxes by filing a simple tax extension. However, while a tax extension is free and may provide needed breathing room, you will be postponing any potential tax refund. You will still be responsible for paying any projected taxes owed when you submit the extension.

This year’s tax refund could include more money than you expected. The remainder of your increased child tax credit, reimbursement for child care expenses, and maybe more stimulus check money will be included in your tax refunds in 2021.

While an extension gives you more time to file your taxes, most tax experts advise against it unless you’re missing crucial tax information or are simply unable to submit it due to illness, travel, or other circumstances. Continue reading to learn how to file a tax extension and how much money you could save if you do.

What is the procedure for requesting a tax extension?

If you want to file a tax extension this year, you must submit Form 4868 (PDF) to the IRS by the April 18 deadline, either on paper or electronically, using an e-file. You must still pay all or part of your anticipated income tax due using Direct Pay, the Electronic Federal Tax Payment System, or a debit or credit card. You must also state that you are filing for an extension.

Some taxpayers are given an automatic extension of time to file. This includes military troops serving in a war zone and those living in disaster zones declared by the federal government.

Will an extension put off any IRS taxes you owe?

No, extending your filing date does not postpone the payment of any taxes you may owe. The IRS recommends that you estimate and pay at least 90% of your tax amount by the deadline to avoid late fees. Otherwise, you’ll have accumulated interest on what you owe, which you’ll eventually have to pay on top of your income taxes, plus any penalties.

For each month or partial month, your tax return is late, the IRS can levy a late-filing penalty of 5% of the amount payable. The late-payment penalty is usually 0.5 percent per month of the unpaid tax due by the filing deadline, with a maximum of 25%. The minimum late-filing sentence is $435 or 100% of the unpaid tax if your return is filed more than 60 days after the due date (whichever is less).

Penalties and interest will stop accruing for individual taxpayers only when the sum is paid in full. For additional information on penalties or to work out a payment plan with the IRS, visit their website.

What is the relationship between stimulus payouts and tax returns in 2021?

If the IRS owes you money for the third stimulus check because you added a new qualifying dependant in 2021, you can file a recovery rebate credit when you file your taxes to get that money back. You might receive up to $1,400 for your dependent, including a newborn or adopted child. When you file, keep a watch out for IRS Letter 6475, which will have all the information you need about last year’s stimulus check.

If you didn’t receive either of the first two stimulus checks or received less than you were eligible for, you may still be able to claim the money through a recovery rebate credit. If you haven’t already done so, you’ll need to submit a 2020 tax return or amend an existing 2020 tax return.

The IRS still had 6 million unprocessed tax returns to sift through by the end of 2021, so if your 2020 tax return hasn’t been processed yet, don’t submit a second return.

What is the relationship between the child tax credit and tax returns in 2021?

Six child tax credit payments were made in 2021, and the remaining funds will be sent to you with your tax return after you file your taxes this year. You’d get the total amount you owe if you opted out of those checks last year.

If you had a new baby or became a dependent in 2021 and the IRS was unaware of it, you may get even more money back. You may be entitled to additional money if your income has changed and you haven’t updated your information in the IRS Update Portal.

You might lose up to $3,600 per child if you don’t file your taxes by the deadline or up to $1,800 if you received all child tax credit payments last year.

This year, are child care expenses included in tax refunds?

For the tax year 2021, the child care tax credit has been increased. The amount of money you can get back for a child or dependent care expenses has increased dramatically. That means you may get up to $8,000 for a single child and up to $16,000 for two or more children.

Daycare, babysitters, transportation to and from care providers, day camp, and before- and after-school activities are all considered expenses. Your tax refund will include the amount you are qualified for reimbursement.

The Tax Deadline Is Approaching How to File a Tax Extension Quickly (1)
The Tax Deadline Is Approaching: How to File a Tax Extension Quickly

If you don’t file your 2018 taxes, you’ll lose all of your money.

The IRS announced on March 25 that the deadline to submit taxes for 2018 is April 18. Any money owed to taxpayers for that year will be lost if they do not file by this day, and the funds will immediately become the property of the US Treasury. According to the government, you could forfeit your tax refund, and any due earned income tax credit.

Read More:- In One State, Stimulus Checks Are Making a Comeback

The IRS also advises people that their 2018 tax refund check may be held if they haven’t filed their 2019 or 2020 returns. Additionally, that money can be used to pay off outstanding child support, past-due federal debts, and any IRS liability.

If you file an extension, would your tax refund be late?

Yes. When you file, the time it takes to get your tax refund is determined. If you file an extension, you have until October 15 to file your return, but that doesn’t mean you have to wait that long.

Because the IRS is still experiencing difficulties due to the epidemic and has a backlog of unprocessed returns, refunds may take much longer than the typical 21 days. Some reimbursements can take months to arrive, especially for more difficult returns or those that require changes.

Read More:- Recipients of the Third Stimulus Check Have One Last Chance to Get It

This year, the IRS is urging taxpayers to file electronically and double-check their information before submitting it to avoid any errors that could cause their returns to be delayed. To receive your money faster, the agency also requests that you join up for a direct deposit.

How to file your tax return for 2021

According to the IRS, taxpayers can file and schedule federal tax payments online, by phone, or through the IRS2Go smartphone app.

If you make $72,000 or less and need to find a tax software provider, you may quickly discover an IRS-approved free filing service. You can use the Free File Fillable Form if your income exceeds $72,000. You’ll need to collect the following data: income statements (W2s or 1099s); any income changes; current filing status (single, married, filing jointly); and dependent information.

If you haven’t already done so, the IRS recommends paying your taxes electronically. Several options are available, including IRS Direct Pay, which is directly linked to a bank or savings account. Another alternative is to pay with a credit card using the IRS2Go mobile app or the Electronic Federal Tax Payment System.

How to access your IRS tax account through the internet

Accessing your IRS account online is a convenient method to see all your tax-related information, including your address and payment plan data. According to the IRS, taxpayers can check their adjusted gross income, find their stimulus payment and child tax credit amounts, and evaluate their projected tax payments or credits using information from their accounts. If you have a tax problem or a missed payment, you can access your tax transcript to get all the data you need.

Read More:- Updates on American Finances: Tax Refunds Will Be Postponed, and a Gas Stimulus Check Will Be Sent…

If you have any further questions, you can seek assistance from the IRS’ Interactive Tax Assistant.

Here’s a breakdown of the differences between a tax refund and a tax return and why you should consider signing up for direct deposit when filing your taxes.

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