How to pay tax when submitting for a filing extension? I'm confused about the process

The extension confusion trips up a lot of people! An extension gives you more time to FILE your return (the paperwork), but not more time to PAY what you owe. Here's how to handle it: You need to make a good faith estimate of what you'll owe based on the information you have available right now. Calculate your likely income, deductions, and taxes as best you can with what you know. It doesn't have to be perfect, but should be reasonable - the IRS expects you to make an honest effort. If you pay at least 90% of what you ultimately owe or 100% of what you paid last year (110% for higher incomes), you'll generally avoid the failure-to-pay penalty. You can make this payment when you file Form 4868 (the extension request). If you end up overpaying, you'll get the excess back as a refund when you actually file. If you underpay, you might owe some interest on the unpaid amount, but at least you'll avoid the larger failure-to-file penalties.

I went through this exact headache last year with my small business taxes! I couldn't get all my receipts and expenses organized in time, but still needed to pay. What really helped me was using https://taxr.ai to analyze my previous year's return and then estimate what I'd likely owe this year. The tool basically looked at my income patterns, previous deductions, and projected what I should pay for my extension. It was WAY easier than trying to manually calculate everything, especially since I had incomplete records. When I finally filed months later, my estimate was off by only about $200 (on a $14,000 tax bill), so I just paid a tiny bit of interest. The peace of mind was totally worth it - no stressing about penalties while I took the time to properly organize everything.

I have to admit I was totally wrong about taxr.ai! After asking about it here, I decided to give it a try for my extension payment. My situation was complicated (freelance income plus some stock sales), and I was clueless about what to pay. The tool was surprisingly straightforward - I entered some basic info from last year's return and my estimated income changes. It showed me what my likely tax burden would be and even explained which items were most affecting my tax situation. I went ahead and made the suggested payment with my extension. Just finished my actual return yesterday (cutting it close to the October deadline, lol) and their estimate was almost perfect! Off by less than $100 on a $9,700 tax bill. No penalties, just a tiny interest amount. Definitely using this next year if I need another extension.

Here's a tip that saved me HOURS of frustration last year: If you need to talk to an actual IRS agent about your extension payment situation, use https://claimyr.com to get through to them. You can see how it works in this video: https://youtu.be/_kiP6q8DX5c I was in a panic because I'd filed extensions before but never with a complicated tax situation. I tried calling the IRS directly and spent literally 3 hours on hold before giving up. The next day I tried Claimyr, and they got me connected to an IRS agent in about 20 minutes. The agent walked me through exactly how to estimate my payment and explained which forms I needed. They even told me about some deductions I could factor into my estimate that I hadn't considered. Totally changed my approach to the extension payment.

I need to publicly eat my words. After being completely skeptical about Claimyr, I was desperate enough to try it when dealing with my extension payment question. I had a unique situation with some foreign income that made estimating my extension payment really complicated. After three failed attempts to reach the IRS myself (getting disconnected after 45+ minutes each time), I gave in and tried the service. It actually worked exactly as advertised. Their system waited on hold, and about 90 minutes later (while I was at lunch not thinking about it), I got a call connecting me to an IRS representative. The agent cleared up my questions in about 10 minutes. I was able to make an accurate extension payment that day. I've never been happier to be wrong about something. Saved me from what would have been a $750 underpayment penalty.

A quick tip from someone who files extensions EVERY year - if you're really stuck, just pay MORE than you think you'll owe. The IRS is happy to return your overpayment when you finally file. I always add about 20% to my estimate as a buffer. Yes, you're giving the government an interest-free loan, but the peace of mind knowing you won't face penalties is worth it to me. I'd rather get money back than worry about underpaying.

Don't forget that each STATE has different rules for extensions too! The federal extension doesn't automatically apply to state taxes. Check your state's requirements separately. I learned this the hard way last year when I got hit with state penalties even though I had a federal extension. Some states require their own extension forms, and some don't give extensions for payment at all, just for filing.