Tax Strategy & PlanningAugust 31, 2026· 8 min read
How to get an EIN number
Cost, lost numbers, W-9 entries, LLC ordering and foreign applicants each have their own answer. Start here and we will point you at the right one.
12+
Years Serving NYC
50
States Covered
5★
Rated on Yelp
150,000+
Returns Filed
Open
Evenings & Weekends
Section 01
How Tax Extensions Work
When you file an extension using Form 4868, the IRS grants you an additional six months to submit your completed tax return. This means the filing deadline is extended from April 15 to October 15 (or the next business day if it falls on a weekend or holiday).
However, a tax extension only applies to the submission of your return—not the payment of any taxes owed. Taxes are still due by the original deadline, typically April 15.
Section 02
Late Filing Penalty
If you successfully file an extension, you avoid the late filing penalty, which is 5% of the unpaid taxes for each month (or part of a month) your return is late, up to a maximum of 25%. Filing an extension ensures you won’t face this penalty as long as you submit your completed return by the extended deadline.
Section 03
Late Payment Penalty
While an extension protects you from the late filing penalty, it doesn’t exempt you from the late payment penalty if you owe taxes. The late payment penalty is 0.5% of the unpaid taxes for each month (or part of a month) after the April deadline, up to a maximum of 25%.
To avoid or minimize the late payment penalty:
- Pay estimated taxes by April 15: Use the IRS Direct Pay system, EFTPS, or send a payment with Form 4868.
- Request a payment plan: If you can’t pay the full amount, setting up a payment plan with the IRS can reduce penalties.
Section 04
Interest on Unpaid Taxes
In addition to the late payment penalty, the IRS charges interest on unpaid taxes from the original due date (April 15) until the balance is paid in full. The interest rate is determined quarterly and compounds daily, so paying as much as you can by the original deadline is crucial.
Section 05
Key Benefits of Filing an Extension
Avoids the 5% late filing penalty.
Provides extra time to prepare an accurate and complete return.
Prevents audit triggers from rushing through your tax preparation.
Section 06
Final Thoughts
Filing an extension can save you from hefty late filing penalties, but it’s important to remember that taxes are still due by the original deadline. To avoid additional costs, estimate and pay as much of your tax liability as possible by April 15. If you’re unsure how much you owe or need help managing your tax situation, consult a tax professional for guidance.
No cost to start
Questions about your specific situation?
Fifteen minutes with a CPA who handles this every week. We will walk you through your options — no sales pitch, no obligation.
Client reviews
What our clients say
“George has prepared and maintained the corporate accounting and provided consultant services for my company for a number of years. He has always done an outstanding, professional and courteous job. I feel that his rates are very fair and he provides a great value for the cost.”
“Excellent service and very professional. George and his team have been handling my business taxes for years and I couldn't be happier with the results. They are always available to answer questions and provide expert advice.”
“I've been working with Dimov CPA for both personal and business taxes. Their attention to detail and knowledge of tax law has saved me thousands. Highly recommend to anyone looking for a reliable CPA in NYC.”
Keep reading
More insights selected for you
Tax Strategy & PlanningAugust 26, 2026· 8 min read
Tourist and city taxes on a New York hotel stay
Is there a tourist tax in New York City? Not under that name. What visitors pay is a hotel occupancy tax stacked on top of three separate sales taxes.
Tax Strategy & PlanningAugust 26, 2026· 8 min read
Transfer taxes on a New York property sale
Who pays New York transfer taxes, at what rate, and how they affect your basis. NYS, NYC RPTT, and the buyer paid mansion tax, explained by a New York CPA.
Ready when you are
Let's talk about the next step
A CPA will review your situation and give you a straight answer. No commitment, no jargon.
