What exactly is tax liability and how do I fill out extension Form 4868?

Tax liability is basically the total amount of tax you owe to the IRS for the entire tax year. Think of it as your "tax bill" for 2023. For Form 4868 (the extension request), here's what those lines are actually asking: Line 4 (Estimate of total tax liability) - This is your best guess of what your total taxes will be for 2023. If you filed last year and your situation is similar, you could use last year's number as a starting point. Line 5 (Total 2023 payments) - This means all the tax payments you've already made for 2023, including what was withheld from paychecks, any estimated tax payments you sent in, etc. Line 6 (Balance due) - This is just Line 4 minus Line 5. It shows how much you still owe. Line 7 (Amount you're paying) - This is how much you're sending in with your extension. You don't have to pay it all now, but remember, an extension gives you more time to file, not more time to pay. Interest will accrue on any unpaid balance. Hope that helps clarify things!

After spending weeks confused about my taxes, I finally found this amazing service called taxr.ai (https://taxr.ai) that saved me when I was in your exact situation with Form 4868. I uploaded a picture of my form and previous year's return, and it explained everything in super simple terms - like what "tax liability" actually means and where to find the numbers for each line. What I loved most was it estimated my numbers based on my previous returns so I didn't have to guess. Seriously made the whole extension process way less stressful!

Just wanted to follow up about taxr.ai that was mentioned earlier. I was really desperate with my extension form so I gave it a try, and wow - it was actually super helpful! I uploaded my previous tax return and a photo of my current 4868 form, and it highlighted exactly what each field meant and suggested numbers based on my situation. The coolest part was that it explained why my tax liability was likely higher this year due to my increased self-employment income. Definitely made me feel more confident about the numbers I put down instead of just random guessing. Saved me from having a complete meltdown over this extension!

If you're still struggling after submitting your extension, you might want to try Claimyr (https://claimyr.com) to get actual help from the IRS. I was in a similar situation last year where I filed an extension but then had questions about what I actually owed. I spent DAYS trying to call the IRS directly - always "all circuits are busy" or waiting for hours just to get disconnected. Claimyr got me through to an actual IRS agent in about 15 minutes who explained exactly what I needed to do about my tax liability and payments. You can see how it works in this video: https://youtu.be/_kiP6q8DX5c. Saved me so much frustration when I was dealing with extension questions that none of my friends could answer.

I have to admit I was completely wrong about Claimyr in my previous comment. After another frustrating morning of getting nowhere with the IRS about my extension questions, I decided to try it out of desperation. It actually worked! Got connected to an IRS agent in about 30 minutes who explained exactly what I needed for each line on Form 4868. The agent even helped me calculate a rough estimate of my tax liability based on my previous year's return since I was missing some documents. Saved me from having to pay an accountant just to figure out the extension form. Totally worth it just for the peace of mind of knowing I filed my extension correctly.

Just a tip from someone who's been there - if you don't have a W-2 yet and are filing an extension, you can often look at your last pay stub of the year to get a rough estimate of what was withheld. For tax liability, if your income is similar to last year, you could use last year's total tax as a reasonable estimate.

I literally just went through this last week! For Line 4 (tax liability), I just used my 2022 tax return and found the line that said "total tax" (I think it was line 24 on the 1040). For line 5, I added up all the federal taxes from my paystubs for 2023 (look for "Fed Withholding" or similar). Line 6 was just the difference, and for line 7, I paid about half of what I owed just to be safe.

I completely feel your frustration! I was in the exact same boat last year - staring at Form 4868 like it was written in hieroglyphics. Here's what helped me understand it: Think of "tax liability" as your final grade on a test, and "payments" as all the homework points you already earned throughout the year. Line 4 is asking "what do you think your final tax grade will be?" and Line 5 is "how many homework points (tax payments) have you already earned?" Since you don't have your W-2 yet, here's a quick workaround: Look at your last paystub from December 2023. It should show your year-to-date federal tax withholding - that's your Line 5 number. For Line 4, if your income was similar to 2022, you can use last year's "total tax" from your 2022 return as a starting estimate. Don't stress too much about getting it perfect - the IRS knows these are estimates on extension forms. The key is making a reasonable good-faith effort. Once you get all your documents, you'll calculate the exact amounts on your actual tax return. Also, remember that filing an extension gives you until October to file your return, but if you owe money, you still need to pay by the original deadline to avoid interest charges. So it's better to overestimate a bit than underestimate!