If you expect to have an amount due for your Federal return, and cannot meet the mid-April deadline, an extension is necessary to avoid a penalty for late filing.
How much time does the extension allow?
Form 4868, Application for Extension, is used to apply for an additional 6 months to file your tax return. Filing an application for extension of time does not allow additional time to pay any tax due.
Will filing an extension prevent me from being penalized?
The extension will prevent you from owing penalties for failure to file if filed in the 6-month window.
However, you may still face failure to pay penalties if your tax due is not paid by the April deadline. The extension does not provide you with more time to pay the amount owed- only more time (6 months) to complete your return and file. Additionally, the IRS begins assessing interest on unpaid taxes on top of penalties.
Do I need to file an extension if I don't owe?
If you are due a refund, you do not need to file an extension; you have three years from the filing deadline to file the return and claim your refund. After this three-year period taxpayers will not be able to claim any over-payments or credits.
Returns filed after the filing deadline (with extension) cannot be e-filed, they must be printed and mailed.