The Internal Revenue Service (IRS) allows individuals to file for an automatic six-month tax-filing extension if they are unable to complete their tax return by the traditional April 15 deadline. The IRS automatically grants the extension as long as the proper paperwork gets filed before the regular tax deadline regardless of whether the taxpayer is filing for the extension because he does not have enough records to complete the taxes or if he simply hasn't had time to complete the return.

Paperwork

Complete IRS form 4868 (see Resources for a link) in order to be given a tax-filing extension. The standard extension is six months from the day the return was originally due, and the IRS rarely makes additional extensions. Form 4868 requires you to supply your identifying information such as your name or names (if filing a joint return), address and Social Security number. Include a payment of what you estimate you will owe in taxes for the year. If you are out of the country, you automatically receive a two-month extension on filing your taxes. However, if you file for an additional extension, you will only be granted an additional four months, making your total extension six months.

Payment

Though the IRS automatically grants a filing extension, you do not receive an extension on the due date for your tax payments. When you file your extension request, estimate the amount you will owe when you complete your return to the best of your ability. If your payment does not equal the amount you owe, you may have to pay late payment fees and interest. If you overpay, you will be refunded the difference when you file your return so you are usually better off overpaying and getting a refund than underpaying and paying additional interest or penalties.

Late Penalties

The IRS late payment fee equals 0.5 percent of the tax owed per month or portion of a month. For example, if you owed $2,000 and you paid 2.5 months late, the late payment penalty would be $50. The maximum late payment fee is 25 percent. If you miss your filing deadline, either because you did not file for an extension or did not file your return by the extended deadline, the penalty equals 5 percent of the sum you owe per month or part of a month, with a maximum penalty of 25 percent. If your return is more than two months late, the minimum late filing penalty equals the lessor of $135 or the balance on your tax return.

Source:

IRS: Extension of Time to File Your Tax Return

IRS: Publication 17

More Information:

IRS: Form 4868