Filing A Tax Extension Is The Best Option For Procrastinators

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Texas CPAs Say Six-Month Extension Will Help Those Who Need More Time to File

The tax clock is ticking, and the countdown to April 18 has begun. If more time is needed to file a 2010 tax return, the Texas Society of Certified Public Accountants says filing an extension may be the best choice.

Most taxpayers can request an automatic six-month tax return filing extension, but Texas CPAs caution that doing so only gives more time to submit a return, not to pay taxes.

FILE FOR EXTENSION ELECTRONICALLY OR ON PAPER
To request an extension, taxpayers can use a single IRS form, Form 4868, Automatic Extension of Time to File U.S. Income Tax Return, for an automatic six-month extension until October 17, 2011. The request for the extension must be made by the original due date for the return – April 18, 2011.

If an extension is filed on paper, the recently revised Form 4868 must be filed and mailed to the address shown in the form’s instructions.

An extension may be filed electronically, with tax preparation software or by using the service of a CPA. In either case, a copy of the return must be handy for taxpayer verification.

AN EXTENSION TO FILE IS NOT AN EXTENSION TO PAY
What hasn’t changed is that the extension is for filing only – not for paying your income tax bill. If you fail to pay on time, you’ll face penalties and interest charges.

Paper extension filers should send a check, payable to the United States Treasury, along with Form 4868, to the address shown in the form instructions. Taxpayers who file for an extension electronically can make payment by authorizing an electronic funds withdrawal from a checking or savings account. Form 4868, which should be used as a worksheet, includes instructions for making credit card payments.

Be sure to keep the acknowledgement number you receive; it serves as proof that an extension has been filed. There is no IRS fee for credit card payments, but some processors may charge a fee.

CONSULT A CPA
If there are questions regarding the process of filing for an extension, consult with a CPA. When it’s time to file, he or she can help prepare the tax return as well.

PERSONAL FINANCE INFORMATION
For more tax tips and specific personal finance information, visit http://www.ValueYourMoney.org. While there, sign up to receive a free monthly electronic newsletter with personal finance tips on variety of topics.

ABOUT TSCPA
TSCPA (http://www.tscpa.org) is a nonprofit, voluntary, professional organization representing Texas CPAs. The society has 20 local chapters statewide and has more than 29,000 members, one of the largest in-state memberships of any state CPA society in the United States. TSCPA is committed to serving the public interest with programs that advance the highest standards of ethics and practice within the CPA profession.

Contact: Kelly Hardwick
972-687-8652 or 800-428-0272, ext. 652
khardwick(at)tscpa(dot)net

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