IRS Expects 6 Million Bids for Extensions

As many as 6 million couples and individuals are expected to ask the Internal Revenue Service for an extra four months to file their tax returns this year.

The filing deadline for most Americans is April 16, but the IRS will grant an extension automatically if a taxpayer unable to file by that date mails in a Form 4868 instead. However, IRS spokesman Steve Pyrek noted Wednesday, the form must be accompanied by a check for estimated taxes owed.

It’s not a good idea to underestimate your taxes when you seek an extension of filing time, said accountant Saul Epstein of the Philadelphia office of Ernst & Young.

“If you underestimate, you’ll have to pay interest on the unpaid amount, and if it (the unpaid amount) is more than 10% of your total liability, there will be an additional failure-to-pay penalty.”

The IRS expects 111 million returns to be filed this year, although not all taxpayers will meet either the regular deadline or an extended deadline. Through March 30, 60.1 million returns had been received, 2 million more than during the same period a year ago.

The IRS has processed 51.5 million of those returns, 3.5 million more than at this time last year. Nearly 79% of returns qualify for refunds; that’s 40.5 million taxpayers this year, who will receive $34.4 billion. At this time last year, about 78%, or 37.3 million, received refunds, which totaled $30.5 billion.

Nearly 3.8 million taxpayers have filed electronic returns, 270% above the same period of 1989 and considerably more than the IRS had forecast for the entire year.

Electronic returns, filed for a fee by IRS-authorized companies, are transmitted to the IRS via telephone line. They eliminate a considerable amount of paper work and errors and allow the agency to promise refunds in two or three weeks.