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Taxes 2022: Here's how to ask the IRS for an extension

Over the past two years, the IRS extended the tax filing deadline because of the COVID-19 pandemic, giving Americans extra time to wrap up their returns. This year, Tax Day returns to its regularly scheduled deadline, with returns due April 18.
The good news? For those who need more time, filing for an extension is quick and straightforward. And it will give you until October 17, 2022, to send your tax return to the IRS. 
Americans are already falling behind in the current tax season, according to the latest IRS statistics. About 91 million people have filed their returns as of April 1, down from 93 million filers at the same time last year, when taxpayers had an extra month to get their taxes to the IRS, according the agency. 
In a typical year, Americans file about 160 million tax returns, which means that some 70 million still need to file before the April 18 deadline. 
"People do have a tendency to wait until the last minute," noted Eric Bronnenkant, head of tax at Betterment. "You can get an extension for six months or so, but one of the most important things to know about filing for an extension is that it's not an extension to pay."
In other words, if you owe the IRS this year, you still have to pay Uncle Sam by the end of April 18 even if you get an extension until October. Here's what to know about how to get an extension from the IRS. 
Typically, the tax filing deadline is April 15, but this year taxpayers have until April 18 to file because the 15th falls on Emancipation Day, which is observed as a holiday in Washington, D.C. As a result, IRS offices will be closed on April 15.
Residents of Maine and Massachusetts get one extra day to file — until April 19 — because of those states' recognition of Patriots Day on April 18. 
Taxpayers who get an extension to file their taxes will have until October 17 to file their taxes. Typically, the extension gives people until October 15 to file their forms, but because that date falls on a Saturday, taxpayers have until the next business day, October 17, to file.
First, you'll have to request an extension by April 18 or you could face a "failure to file" penalty, the IRS said. (See more on that penalty below.)
To ask for an extension, you'll need to fill out  Form 4868. This is a one-page form that asks for basic information such as your name, address and Social Security number. It also asks you to estimate how much you owe in taxes. 
This form can also be used through the IRS' Free File service, and can be used regardless of income. Typically, only people with adjusted gross income below $73,000 can use the Free File service, but anyone can use it to ask for an extension, the IRS said. 
That's right — getting an extension to file your tax return doesn't give you an extension on paying what you owe the government. 
The IRS expects people to make an effort to pay what they owe, Betterment's Bronnenkant said. That may be difficult for people who haven't yet filled out their tax returns, but it's best to make a good-faith estimate. 
"If your prior year is a good barometer for your current year, start with that as a way to come up with some sort of reasonable estimate," Bronnenkant said. "Don't let perfect be the enemy of good enough."
For instance, if you estimate that you owe $10,000 but end up actually owing $11,000, you'll be charged an underpayment penalty. But it will be less painful to face an underpayment penalty for $1,000 rather than the entire $11,000 that you owe, Bronnenkant noted. 
If it turns out the IRS owes you money, you'll have to wait until after the IRS processes your tax return for the refund. So if you hold off until October 17 to file, you won't get the refund until about three weeks after that date based on the IRS' assessment that most taxpayers receive their refund within 21 days of filing.
If you believe the IRS owes you money, you don't have to send in a check by April 18 to the IRS, of course. However, you should be confident that you are correct in your assessment, otherwise you'll face penalties for failing to pay your debt to the IRS. 
If you aren't going to get your tax return finished by April 18, it's best to file for an extension because the failure-to-file penalty is stiff. It is based on the lateness of a tax return as well as the size of unpaid taxes from the due date. 
The penalty rate is 5% of unpaid taxes for each month that a filing is late, capped at 25%. Take a taxpayer who owes $10,000 but doesn't file for an extension — if they file two months late, they would $500 each month for a total of $1,000 in penalties. 
The failure-to-pay penalty is less punitive than the one for failing to file. The IRS charges 0.5% of the unpaid taxes for each month, with a cap of 25% of the unpaid taxes. 
Take someone who pays an estimated tax of $10,000 by April 18, but it turns out they actually owe $11,000. They'll face a 0.5% charge on the extra $1,000 they owe the IRS. If they file in June — two months after the tax deadline — they would owe $10. 
That depends. Once you've requested an extension from the feds, check if you'll need to do so for your state. According to the IRS, "State filing and payment deadlines vary and are not always the same as the Federal filing and payment deadline." 
Some states will automatically give you an extension on your state taxes if you receive a federal extension. In other states, you'll need to request an extension separately. The Federation of Tax Administrators offers a rundown of how to check for tax information for the state you live in. 
If you live in one of the nine states without personal income tax, you're likely in the clear. However, two of those states — New Hampshire and Tennessee — still tax investment income, so, if you have earnings from dividends, stock sales or other investments, you may still have to file a state tax return in those states.