Down to the Wire: What you need to know before filing a Tax Extension

IDAHO FALLS, Idaho (KIFI) — With the tax deadline looming just two days away, the pressure is on! If you’re staring at a mountain of paperwork with no end in sight, you may want to file an extension—but financial experts warn there is a catch you can't afford to ignore.

However, local accountants and tax attorneys stress that while an extension gives you more time to file, it does not give you more time to pay.

"It is not an extension to pay. So everyone who files a 4868 should submit the form electronically or by paper, but include the total estimated tax that's due," Charles Brooks, the district coordinator for AARP Tax Aide, stated.

The extension is meant to give taxpayers additional time to file their tax returns. If you plan to file a tax extension (Form 4868), you will still need to estimate and pay any owed taxes by IRS by the April 15 deadline to avoid getting hit with expensive penalties.

"There are 2 penalties for filing late," Brooks said. "There's the late filing penalty. There's also a late payment of tax. So it's about 5% a year interest before. But it's also 5% per month for late filing."

If you file the extension, you could risk accumulating interest and late-payment penalties if you do not pay your taxes on time. But it will not increase your audit risk.

Extending your taxes is a great tool for getting your paperwork together, but not if you're looking for a discount.

The tax extension is free to file and gives the taxpayer until October 15 to file paperwork. For more information, click HERE.