Extending a U.S. Tax Return’s Due Date
One distinct aspect of the U.S. tax system is the ability for a taxpayer to extend the due date of a tax return. This allows the taxpayer additional time to complete and file an income tax return without being assessed a late filing penalty. Late filing penalties are assessed at the rate of 5% per month up to a maximum of 25%. In most cases a tax return due date can be automatically extended by up to six months. All that is required is the filing of the proper extension form. No explanation from the taxpayer is required and the IRS cannot deny a properly filed extension. However, the timely filing of the form is crucial in order for the extension to be valid.