Taxing Times: Should I File For An Extension?

2020 was a year unlike any other for the economy, with the pandemic drastically changing the workforce and leaving millions of people financially insecure. 

I'm not an expert, but we talked to lots of them and asked: Should I file for an extension to file taxes? 

"You should file an extension if you believe that you will not have your tax return completed by the deadline. One of the things you do want to keep in mind when it comes to an extension: It extends the time to file, but it does not extend the time to pay," said Kemberley Washington, tax analyst with Forbes Advisor.

So if you owe taxes, filing an extension is not an option if you don't have the money to cover your bill. And if you don't pay on time, you could be subject to penalties plus interest.

"I always consider it kind of a best practice to not get an extension and to really file your taxes as early as you are able, as early as you have all of your documents," said Mark Steber, chief tax information officer at Jackson Hewitt Tax Service.

But experts say it is a good idea to file for an extension if you're missing the right paperwork. 

"If you do not have all the documents that you need, and especially this year, if you don't have all your information for the stimulus, perhaps your unemployment, all the other things that the tax laws changed and you file a basically an incomplete return, get some documents after the fact, that's going to result in filing an amended return," said Rhonda Collins, director of tax content and government relations at the National Association of Tax Professionals.

For more information on the 2020 tax season, visit newsy.com/TaxingTimes.