IRS Tax Tempe AZ Attorney
Don’t confused IRS form 4868 which is an extension of time to file your return, with IRS form 1127 which is to request an extension of time to pay your taxes. Here are some of the differences:
* IRS form 4868 gives you an additional six months to file your return. You do not have to give any explanation. It is automatic. Here in Arizona it also extends the time to file your Arizona return. IRS form 4868 must be filed by April 15.
*IRS form 1127 Allows you to delay paying your taxes until August with interest but no penalties. But the guidelines for this delay have strict requirements. This form must be filed by April 15th.
IRS form 1127 requires you to provided complete details of your assets and liabilities at the end of the previous month and an itemized list of money your have received and spent over the last three months. The IRS wants to verify that your are unable to pay and the reasons why you are unable to pay. You will have to provide documentation that you are unable to pay the money. It must be legitimate “undue hardship,” not just an inconvenience.
It is important to know that the failure to pay penalty is 1/2% per month (form 1127), and the failure to file penalty is 5% per month initially (form 4868). Taking this into consideration, it is 10 times more important that you file IRS form 4868 than IRS form 1127. Even though it is possible to delay paying your tax liability, take into consideration the additional cost (1/2% per month) with the chances the effort needed to file IRS form 1127 and the chance that the IRS District Director might deny your request.
To appropriately evaluate your situation, consider a free consultation with Scott Allen E.A. at 480-926-9300. It is doubtful that an Tempe AZ IRS Tax Attorney would even know what your are talking about if you inquire about filing IRS form 1127.