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Military Members & Extension on Filing & Paying Taxes

Military Members & Extension on Filing & Paying Taxes

Did you know many military members and their family members can get a tax deferral extension? In several cases, the extension is automatically granted, and some people may even receive an extension to pay money they owe Uncle Sam.

Automatic Six Months Extension

All taxpayers living in the United States can receive an automatic six-month extension to file their tax returns by completing IRS Form 4868. Taxpayers can complete the form electronically or on a paper form. 

Taxpayers requesting this extension must pay their taxes due by the normal April 15 filing deadline to avoid interest or penalties for the unpaid amount.

Extensions for people outside the United States

Three extensions are available to taxpayers outside the United States and Puerto Rico on April 15. Military personnel stationed, deployed, or aboard a ship, as well as civilians, can benefit from these extensions. Military families filing jointly also qualify; those who file separate returns do not.

  1. Automatic two-month extension: Non-US taxpayers are entitled to an automatic two-month extension without filing any paperwork. In writing, they must notify the IRS of their status when filing the return. Interest will be charged for unpaid tax debt up to the normal due date.

  2. Form 4868 (Extra automatic four-month extension): By filing Form 4868 by June 15, those outside the United States can request an additional four-month extension. When completing the form, taxpayers must check the box on line 8 to receive the automatic extension by October 15. As usual, unpaid taxes are subject to penalties, fees, and interest.

  3. Additional two-month discretionary extension: In addition to the six-month extension (automatic extension of two months and automatic extension of an additional four months), taxpayers may request a discretionary extension of an additional two months to file their return by December 15. Taxpayers should send a letter to the IRS explaining why they need an additional two months.

Combat Zone Extension

Those serving in combat zones or supporting a combat operation may be eligible for an automatic six-month extension of their tax returns; this applies to military and civilian personnel.

The deadline is extended by 180 days after you leave the eligible area after that area is no longer designated as a combat zone or after your operation is no longer considered an emergency. You may also be eligible for an extension if you are hospitalized outside the United States for injuries sustained in a combat zone or hazardous work area.

This extension also lets taxpayers defer payment of any tax due without penalty or interest.

While the Internal Revenue works with the Department of Defense to automatically determine who is eligible for combat zone expansion, civilians serving in support of a combat operation must notify the IRS of their status to receive the extension. (It doesn't hurt for active members to do the same.)

Extension on the payment of taxes

As you can see, the IRS will allow you to defer filing your taxes, but in most cases, even though you can defer filing your tax return, you must pay the taxes before the due date to avoid paying interest on the amount and possibly penalties. The only exclusion from this rule applies to those serving in a combat zone. However, there is another exception to this rule: military personnel may be eligible for an extension of tax payment if their ability to pay taxes has been "significantly affected by military service."

Service members must request this extension in writing to the IRS. If the request is granted, the extension will allow them to defer paying taxes due for up to 180 (one-hundred and eighty) days after leaving the military. Reserve Service or National Guard must be federally licensed; State duty is not eligible.

Please note that these extensions only apply to federal taxes. Although most states follow federal rules, it's best to check your specific state to avoid penalties later. Speak to a tax expert to help determine what is obtainable in your state.

For most individuals, especially those expecting a refund, filing taxes before the due date is still the best and easiest option. Getting a tax professional to help work on your tax preparation and filing designed specifically for the military. 



Dennis Jao
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