MW Filed an extension for your income taxes? The IRS is still charging you.
By Morey Stettner
An extension delays paperwork, but not your payment. Settle your estimated bill now to stop daily IRS penalties.
Many people put their taxes on extension, but late-filing charges still apply.
April 15 - tax day - was exactly 54 days ago. If you are among the U.S. taxpayers who didn't file on time, putting your income taxes on extension bought an extra six months to complete your return. But filing an extension did not extend your due date for paying taxes. You were still required to make a reasonable estimate of your tax bill and pay by April 15.
If you still haven't paid, the IRS penalties are growing at a 6% annual interest rate. Nevertheless, many keep procrastinating right up until the six-month extension ends on Oct. 15 - refusing to gather necessary documents to determine how much they owe.
Of course, ignoring the problem won't make it go away. Over time, it may even chip away at your peace of mind.
Typically, filing an extension isn't a matter of putting off a cheerless chore. Some people lack the time or focus to tackle the task. "Sometimes they file an extension because they didn't start early enough to get organized and gather their 1099s and other forms," said Jessica Banitt, a Houston-based certified public accountant and certified financial planner. "Or they have something unique going on or have a question and don't start researching it until April 13."
To avoid such problems, tax preparers try to give clients a head start. They distribute checklists and tax organizers in late December, urging clients to make incremental progress early in tax season to avoid last-minute stress.
They may also set an artificial deadline well before April 15. At Joon Um's tax and accounting firm, new clients are told to finish their paperwork by March 1, or his team may be too busy to make the April 15 deadline.
If they file an extension, they should follow through. "They may go on summer vacation and are too busy with their lives to do each [tax preparation] step," said Um, a certified public accountant in Beverly Hills, Calif. "So we set up an appointment before their vacation" to remind them to check off pending to-do items.
In other cases, diligent taxpayers file extensions because they don't have all the forms they need. Schedule K-1 forms, for example, may arrive late. And even if brokerage firms furnish consolidated 1099 tax statements in February, corrected versions may be issued later, delaying the accurate completion of returns.
Sometimes, procrastination is someone's way of avoiding a fear that they'll owe the government a great deal of money. If you suspect you'll have a high tax bill, filing an extension probably won't allay your concern. But a knowledgeable tax preparer can help manage expectations.
Philip Wu, a Chicago-based enrolled agent with the IRS who prepares taxes for clients, tells of a client who was victimized by a Ponzi scheme and lost a bundle. Suspecting she'd owe the IRS hundreds of thousands of dollars, she dreaded filing her taxes.
"Thankfully, tax laws allow for deductions for Ponzi scheme victims," Wu said. Once she learned this, he added, finalizing her return wasn't as agonizing.
More: You're going to pay tax on RMDs - there's no way around it. Or is there?
Also read: No do-overs: How one extra dollar on your Roth conversion triggers a tax bill you won't see coming
-Morey Stettner
This content was created by MarketWatch, which is operated by Dow Jones & Co. MarketWatch is published independently from Dow Jones Newswires and The Wall Street Journal.
(END) Dow Jones Newswires
June 08, 2026 07:53 ET (11:53 GMT)
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