How To File IRS Tax Extension - A Guide For NRIs Living In US

An IRS tax extension gives taxpayers time to submit their tax returns, pushing the deadline back by six months. However, the tax extension is strictly an extension to file, not an extension to pay. Any taxes you owe shall be paid by the original April deadline to avoid penalties and interest.

In this blog, we will cover IRS tax extension, how to file, and more related aspects.

What Is Tax Filing Extension

If you are an IRS taxpayer and were unable to file a tax return by the due date, you can claim a filing extension. File IRS Form 4868 for an automatic six-month extension. Businesses are also eligible to file IRS Form 7004 for an automatic six-month extension.

For the 2025 tax year, the returns are due by Tuesday. April 15 2026. If you are filing an extension, you must do so by April 15. In case your extension is granted, you must file your return by October 15 2026. Note that if you file an extension and owe taxes, you still need to pay them by April 15, 2026.

Savetaxs Tip: When you file an extension, you do not need to explain why you need more time.

The Extension Is To File, Not To Pay

Many taxpayers are confused about this. The extension gives you additional time to file your tax return, not to pay the taxes you owe. Meaning the taxpayers who cannot pay their taxes by the due date won't get any more time to pay by filing an extension; however, they can avoid the failure to file penalty, which is usually 5% of the total amount owed per month, and this penalty can reach as high as 25%. Whereas the failure to pay interest is of 0.5% of the amount you owed per month.

Interest accrues on unpaid taxes until they are paid in full. If a return is more than 60 days late, the additional tax is $525 or 100% of the amount due, whichever is less.

How To File An Extension With the IRS

There are three ways to request a filing extension with the IRS.

1: Pay all or a part of your estimated income tax due, and indicate that the payment is for an extension.

2: File Form 4848 electronically by yourself using any software, or with the help of a tax professional.

3: File a paper Form 4868 and enclose payment of the estimated tax due.

However, the following is a detailed overview of the step-by-step process for filing an IRS tax extension.

Step 1: Find out whether you owe money or are due a tax refund

Generally, you do not need to calculate your exact tax liability to the last dollar; however, you must calculate your adjusted gross income (AGI) and compare it to the taxes you paid during the year to determine whether you owe the IRS or are likely to receive a refund.

The IRS already has instructions on how to calculate your AGI, but as an NRI, it is advisable to consult a tax advisor who is well-versed in NRI and cross-border taxation or use tax software to be sure of your number. And yes, do not miss out on claiming available tax credits and deductions, that can significantly reduce your taxable income.

Now, if you think that you owe a tax refund from the IRS, do not file for an extension. However, it is generally advisable to still file just in case. Additionally, some states in the USA require a federal extension to get the state extension.

Step 2: File An Extension On Your Federal Taxes

There are several ways to file an extension. You can either electronically request an extension by completing IRS Form 4868 (Application for Automatic Extension of Time to File U.S. Individual Income Tax Return) or fill out and mail the paper form.

The IRS Form 4868 is available on the IRS website, or you can access it through IRS Free File, an e-filing program for US taxpayers with an AGI of $89,000 or less. It is always best to consult with a tax professional or use tax software to access tax extension information and forms.

should be "The federal tax extension is generally granted, but you should check back to verify the status of your extension request. If you need to correct your request due to misspellings or other mistakes, If corrections are required, consult IRS guidance or your tax advisor promptly.

Step 3: File A State Extension If Needed

The chances are that if you owe federal taxes, you also owe state taxes in the state where you reside or work. This, however, can be a concern for self-employed contractors or sole proprietors who are not required to pay quarterly estimated state taxes.

A federal tax filing extension or a state extension will give you more time to prepare your tax return. This does not extend the deadline for paying your taxes.

Step 4: Figure Out A Payment Plan

To avoid being charged interest or late payment penalties as a taxpayer, you must pay as much of your tax as you can by the due date. If you are worried you cannot cover the unpaid taxes, please don't panic; you have options.

If your balance due to the IRS is $50,000 or less, you can request that the IRS accept monthly payments under a long-term repayment plan. As a taxpayer with a balance between $50,000 and $100,000, you can use a short-term repayment plan of 180 days or less.

You can check the state's website to learn about the plan options available in your state. For instance, the state of California offers qualified taxpayers who owe $25,000 or less payment plans lasting three to five years.

Special Filing Extension for U.S. Taxpayers Living Abroad

U.S. citizens and resident aliens who live and work outside the United States on the regular due date generally receive an automatic two-month extension to file their federal income tax return. However, any tax due must still generally be paid by the original filing deadline to avoid interest charges. If additional time is needed, they can further request a six-month extension by filing Form 4868.

The Bottom Line

As an NRI taxpayer with the IRS, it is imperative that you stay up to date on tax regulations and deadlines to ensure you file your taxes properly and on time and pay the correct amount. In most cases, you will have all the updated information if you use tax-filing software; otherwise, it's best to consult a tax professional.

By April 15, if you haven't had a chance to file your tax return, make sure to file an extension with the IRS. Your extension will most likely be automatically granted, and you will have a time window to file until October. But if you owe any taxes, make sure to pay them by April; otherwise, you might get stuck with interest and penalties.
As an NRI, if you are seeking professional assistance with filing your IRS taxes or IRS extension, Savetaxs is the name to trust.

Our experts will help you with data organization and tax preparation, including preparing US individuals' income tax returns and special international forms such as FBAR, FATCA, and more. Other than this, the NRI IRS tax expert will provide end-to-end assistance, including software management and much more.

Connect with us as we serve our clients 24/7 across all time zones.