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IRS eases taxpayer’s pains: File delayed tax return with Form 4868

July 13th 2015
IRS eases taxpayer’s pains: File delayed tax return with Form 4868

Tax day just went by and more than 70 million Americans had been busy for months collecting funds and preparing their files. Federal income tax is an extremely important source of revenue for the government and as such the Internal Revenue Service (IRS) is very stringent when it comes to collecting the money.

Given that the economy is not doing too well to churn out jobs and coupled with the rate of inflation, more and more people are finding it hard to pay their taxes in full and on time. In fact, an average of almost 7 million Americans fail to pay their taxes every year.

The IRS does not treat tax defaulters lightly. The implications of failing to file your taxes are pretty grave. If you don’t file your taxes at all you might get slapped with a fine of up to $25,000 or 1 year in prison or both. If you do file your taxes but fail to include the payment, the IRS will levy a 6 percent yearly interest on the amount owed. Moreover, if the IRS chooses, that can put a tax lien on your assets. In case you are one amongst the millions who are unable to file their taxes, here are your options.

Delay the payment using Form 4868

You can earn yourself a short reprieve period of 6 months by filing a Form 4868. You can pick up the form directly from the IRS office, order it via the Internet or place an order by calling at a toll free number (1-800-829-3675). Since it is an automatic extension, you don’t need to provide the IRS with any reason to avail the extra time. You also need to remember that the form needs to be filed within the normal due date that the IRS sets for filing returns. Extensions are limited to just one per year. So, you’ll necessarily have to file your taxes before the midnight of 15th April 2014.

In case you are out of the country, the IRS will automatically give you a 2 month’s extension. You will not need to file a 4868 beforehand to cover for this. The deadline to file the final tax return after extension (including your overseas stay) is April 15th. You should note that the IRS will only consider you to be “out of the country” if you are living and working outside the United States or in case you are with the military, serving overseas.

Moreover, if you’ve downloaded the 2013 Form 4868 before 4th January, 2014, or plan to use the same printed form, then there are some changes in the address that you must follow.

Please note that on page 4 of the “Where to File a Paper Form 4868” section, the IRS has directed all taxpayers who are filing Form 4868 and would like to make the payments residing at Connecticut, Maine, Delaware, New York, Maryland, District of Columbia, Vermont, Rhode Island, New Hampshire, Massachusetts, Pennsylvania or West Virginia to send those in the below mentioned address:

Internal Revenue Service P.O. Box 37009 Hartford, CT 06176-7009

Alternatively, if you reside at Arkansas, Iowa, Kansas, Illinois, Michigan, Nebraska, Minnesota, Indiana, Montana, Wisconsin, North Dakota, South Dakota, Oklahoma or Ohio and want to mail the Form 4868 but wouldn’t make the payments, then you’ll have to send in your tax papers at:

Department of the Treasury Internal Revenue Service Center Fresno, CA 93888-0045

Extended use of electronic signatures

The IRS in its publication 1345, “Handbook for Authorized IRS e-file Providers for Individual Income Returns” grants some novel methods to the taxpayers for signing in their tax application Form 8878, the IRS e-file Signature Authorization Form 4868 and Form 2350 through a similar e-file signature authorization form.

How-to use electronic signatures

There are two methods to file your tax return electronically:

First, you can use a self-chosen personal identification number (PIN) and provide your previous year’s adjusted gross income (AGI) or PIN to the IRS.

Second, in this method, you’ll have to sign Form 8878 to allow an electronic return originator (ERO) to input your PIN as well as your Form 4868, formally known as Application for Automatic Extension of Time to File U.S Income Tax Return. From then on, you’ll be able to sign the authorization form electronically on an electronic signature pad.

However, the IRS requires you to sign on the electronic pad at the ERO’s office and not remotely. In order to make your tax e-filing acceptable, the electronic signature process should generate a proof that the signature is yours and authentic. This is to ensure that you as a taxpayer is, in reality, associated with the electronic signature concerned.

In case of multiple taxpayers associated with the electronic record, then the same electronic signature process should be able to clearly validate and identify all of them individually. Here, the IRS asks the ERO to retain all the forms containing your signature and should be able to furnish it whenever needed.

In case of multiple taxpayers associated with the electronic record, then the same electronic signature process should be able to clearly validate and identify all of them individually. Here, the IRS asks the ERO to retain all the forms containing your signature and should be able to furnish it whenever needed.

Failure to file can hurt you financially

Late payment of taxes would cost you 6 percent interest plus another 0.5 percent per month as penalty. The penalty for filing your taxes late is set at 5 percent every month of the unpaid taxes due. It’s an expensive lesson the IRS impresses on people who are not sending in their paper work on time.

Roughly translated, its stands at $50 a month paid as fine for every $1000 owed to the IRS. In case you owe less than $25,000, you can file your taxes online and work out a payment agreement with the IRS. Its one of the more popular ways to filing taxes on time, avoiding penalties and easing the financial pressure of paying taxes.

The Internal Revenue Service is far more lenient than people make them out to be. They would rather agree to relax their conditions and let you pay off your taxes than drag you to court and obtain a judgment against you.

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