Planning to file a tax extension? What happens to your missing stimulus money if you do

January 31, 2021 0 By boss



You can file an extension on your taxes by April 15.

Sarah Tew/CNET

If you need more time to prepare and file your taxes this year, no worries — you can file an extension with the IRS. The extension would make your new due date for filing taxes Oct. 15, rather than the April 15 deadline. But knowing that the only way to get your missing stimulus money is by claiming it on your tax return, what happens if you file a tax extension? And what could happen if a third stimulus check arrives before you file your 2020 taxes?

If you’re planning to extend your tax filing to a later date, you’ll need to file the extension no later than April 15, 2021. Also note that filing a tax extension won’t stop you from having to pay any taxes you may owe — you’ll still be required to pay those by April 15, otherwise you’ll accrue interest you’ll eventually have to pay. 

Here’s what happens to your missing stimulus money if you file a tax extension this year. Once you do file, here’s how to track your combined refund and stimulus payment.

Will I still get my missing stimulus check if I file a tax extension?

Yes. But you should know the only way you’ll get your missing stimulus money is by filing a Recovery Rebate Credit on your taxes — even if you’re not usually required to file taxes. So the longer you wait to file, the longer it’ll take to get your tax refund, which will include your missing stimulus payment.

Now playing:
Watch this:

Second stimulus checks: Everything you need to know


When can I expect to receive the money?

It depends on when you file. While you have until Oct. 15 to submit your return if you’ve filed an extension, it doesn’t mean you have to wait that long to file. 

For example, if you were to file by Feb. 12 — that’s when the IRS will begin processing tax returns — you could receive your money as soon as Feb. 19. However, if you wait until Oct. 15, the earliest you would get the money is Oct. 22. 

See our chart below for more details on when you can expect your tax refund, which will include your missing stimulus payment.

When to expect your tax refund

If you file on this date This is the soonest This is the latest
Feb. 12 Feb. 19 March 5
March 1 March 8 March 22
April 1 April 8 April 22
April 15 (last day to file) April 22 May 6
Oct. 15 (last day with extension) Oct. 22 Nov. 5

How would a third stimulus check fit in if it arrives during tax time?

That’s a good question and one we’ll need the IRS to answer when and if Congress approves a third stimulus check. It’s possible the IRS would leverage tax season to send out checks, or the agency might send a standalone payment. The first stimulus checks were calculated based on how much stimulus money you were owed using information in the most recent tax filing, while the second check used 2019 taxes only to determine your share. We have to see how the IRS will handle this situation for people who file for extensions.

How to file a tax extension in 2021

There are three ways the IRS says you can file a tax extension:

Option 1: Pay all or part of your estimated income tax due and note the payment is for an extension using Direct Pay, the Electronic Federal Tax Payment System, or using a credit or debit card. 

Option 2: File Form 4868 electronically by accessing IRS e-file using your tax software or by working with a tax professional who uses e-file. Make sure you have a copy of your 2019 tax return.

If you need to find a tax software service to use, and you make $72,000 or less, you can use the IRS Free File Online tool to find the best free filing system. You’ll need to gather the following information: income statements (W2s or 1099s), any adjustments to your income, your current filing status (single, married, filing jointly) and dependent information. If you make more than $72,000, you’ll be able to use the Free File Fillable form when it opens Feb. 12.

Once you enter all your information, the IRS will help determine which option is best for you — for example, it could be IRS Free File Program by TurboTax or TaxSlayer.

Option 3: File a paper Form 4868 and enclose payment of your estimate of tax due. Make sure it’s postmarked on or before April 15.

Now playing:
Watch this:

How to file a tax extension during the COVID-19 pandemic


For more tax information, we spell out the difference between a tax refund and a tax return, how tax season is different in 2021 and three reasons to sign up for direct deposit when you file your taxes.


Source link