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Tax Extensions, Penalties, and Safe Harbor

Haven’t yet filed your taxes? Not sure if you can get them in today? The good news is that you can file a tax extension and get yourself another 6 months (until October 15) to get your taxes in order. You can fill out form 4686 (PDF) from the IRS website, or file an extension using free online tax software.

Filing an extension doesn’t get you out of paying your taxes now–based on the information you have, you’ll have to send in an estimated payment if you think you owe money. Otherwise you’ll still have to pay interest for paying your taxes late. But filing an extension may give you time to get everything sorted out if you haven’t already. Don’t let this be an excuse to put off sending your return until October 15.

In other tax news, remember that the first quarter’s estimated payments for self employment income are also due today. Or adjust your W4 at your regular job (if applicable) to add extra witholding that will keep you from underpaying your taxes. Remember that unless you’ll fall under safe harbor next year, you may have to pay penalties for not making estimated payments or adjusting your withholding.

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