Individuals who need more time to file their federal income tax returns use Form 4868, Application for Automatic Extension of Time To File U.S. Individual Income Tax Return to request additional time to file, according to the Internal Revenue Service. Reasons for this extension vary and may be due to the taxpayer's need to obtain additional tax documents or replacement W-2s or because of an illness or death in the family that leads to the inability to file on time, notes Intuit. Taxpayers wishing to recharacterize Roth IRAs to traditional IRAs may use an extension as a strategic move to avoid paying tax on the IRA's balance.
Form 4868 automatically grants a six-month extension beyond the normal April 15 filing deadline, notes the IRS. However, filing an extension does not extend the due date for any taxes owed. Taxpayers who fail to pay the tax due to the IRS by the deadline may be assessed penalties and interest until their tax debts are paid. For example, the IRS charges .5 percent each month on the tax owed beginning the month after the deadline. If the return is not filed by the date of the extension, the penalty increases 5 percent each month to a total of 25 percent. Filers who make tax payments prior to the deadline are automatically given the extension without filing the form to ask for it, according to Intuit.