Tax Deadline Approaching: When to File Now vs. Request an Extension

As the April 15 tax deadline approaches, many individuals find themselves short on time, missing documents, or facing complex tax situations. If you’re feeling behind, you’re not alone—and you still have options to avoid costly mistakes and penalties.

Below are practical, IRS-backed strategies to help you decide whether to file now or request an extension, and how to avoid common pitfalls.

1. Filing an Extension: A Strategic Option, Not a Setback 

Requesting an extension gives you until October 15, 2026, to file your federal individual income tax return. This can be a wise move if:

• You’re waiting on key documents (such as Schedules K-1, brokerage statements, or corrected Forms 1099)
• You’ve experienced major life changes (job change, property sale, new investments)
• Your return is complex and requires careful review

Important: An extension only extends your time to file, not to pay. Any tax owed is still due by April 15, 2026. Failing to pay on time will result in interest and penalties, even with a filing extension.

2. Payment Is Still Due by April 15

To avoid late payment penalties and interest, pay as much of your estimated 2025 tax liability as possible by the original deadline—even if you file for an extension.

Best practices:

• Aim to pay at least 100% of your prior year’s tax liability (or 110% if your adjusted gross income exceeded $150,000), if feasible.
• If uncertain, it’s safer to slightly overpay—any excess can be refunded.
• Make payments electronically via IRS Direct Pay, the Electronic Federal Tax Payment System (EFTPS), debit/credit card, or digital wallet.
• If you can’t pay in full, pay what you can. Partial payment reduces penalties and interest, and you can set up a payment plan for the balance.

3. Double-Check Commonly Missed Items

Before filing or requesting an extension, review your records for these frequently overlooked items:

• All brokerage and investment accounts (including small or inactive ones)
• Cryptocurrency transactions (even minor activity must be reported)
• Side income, consulting, or gig work (Forms 1099-NEC, 1099-K, etc.)
• State tax payments and estimated tax payments
• Charitable contributions, especially non-cash donations
• Health Savings Account (HSA) contributions and related forms (1099-SA, 5498-SA)
• Digital asset transactions: All filers must answer the digital asset question on their return, even if they had no activity.

Missing any of these can lead to IRS notices, amended returns, and unnecessary stress.

4. Why Extensions Can Lead to Better Outcomes

Rushing to file can increase the risk of:

• Errors and omissions
• Overlooking valuable tax credits or deductions
• Inaccurate estimated tax calculations

Filing an extension allows you to:

• Wait for final or corrected tax documents (e.g., K-1s, 1099s)
• Consider tax planning strategies
• Coordinate with financial and tax advisors
• Ensure your return is accurate and complete

For many taxpayers, an extension results in a more accurate and advantageous return—not just a later one.

5. What You Should Do Now

If you’re considering an extension, timely communication is essential. Let your tax advisor know:

• Whether you wish to file now or extend
• Which documents you’re still waiting for
• If you need help calculating an extension payment

Even partial information helps your advisor guide you before the deadline.

Take Action Before the Deadline

If your return is complete and accurate – file it. If not, extending is often the smarter move.

The goal is not speed, but accuracy, compliance, and minimizing surprises. If you have questions or need help determining your next steps, reach out to your tax advisor so you can be advised before the filing deadline.