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September 10, 2013 - Phil Hodgen

2012 filing extension until December 15, 2013? Here’s how

For Americans living abroad and sweating the October 15 tax filing deadline, there is a possible piece of relief.  You may be able to qualify for a further extension of time for filing your tax return–to December 15.

Summary

If you are an American living abroad, and you want to get a filing deadline of December 15, 2013 for your 2012 Form 1040, do this:

  1. On or before June 15, 2013, file Form 4868.
  2. On or before June 15, 2013, pay whatever tax you have to pay for 2012, along with that Form 4868 you are filing.
  3. On or before October 15, 2013, write a letter and mail it to the IRS using the procedures I describe below.
  4. File your 2012 Form 1040 on or before December 15, 2013 with all of the stuff attached to it that I describe below.

Basic filing deadline: April 17, 2013

Start with the basic rule. Everyone’s 2012 income tax return has a filing deadline of April 15, 2013. ((IRC Section 6072(a).)) For the tax nerds among you, this is what the rule says:

In the case of returns under section 6012, 6013, 6017, or 6031 (relating to income tax under subtitle A), returns made on the basis of the calendar year shall be filed on or before the 15th day of April following the close of the calendar year and returns made on the basis of a fiscal year shall be filed on or before the 15th day of the fourth month following the close of the fiscal year, except as otherwise provided in the following subsections of this section.

Individuals are required to file income tax returns by the requirements of Internal Revenue Code Section 6012. It doesn’t matter where you live.

Americans living abroad: automatic extension to June 15, 2013

Americans living abroad have an automatic extension to file their income tax returns. They get an extra two months. No work is needed and no paperwork required: ((Treasury Regulations Section 1.6081-5(a)(5))).

An extension of time for filing returns of income and for paying any tax shown on the return is hereby granted to and including the fifteenth day of the sixth month following the close of the taxable year in the case of . . . United States citizens or residents whose tax homes and abodes, in a real and substantial sense, are outside the United States and Puerto Rico[.]

The sixth month after the closing of the tax year (December 31, 2012) is June. The fifteenth day of June is your deadline. You get this extension automatically if your tax home is outside the United States or Puerto Rico.

Note that this automatic extension only applies to people who have their “tax home” outside the United States and Puerto Rico, or to military personnel posted outside the United States and Puerto Rico. If you are abroad temporarily (on vacation or for work), you do not get the automatic extension.

The way you get this extension is simple. If you are filing your 2012 Form 1040 on or before June 15, 2013, all you need to do is write “Taxpayer Abroad” at the top of Page 1 of Form 1040 when you file it. The Instructions to Form 1040 give you this piece of information.

If you plan to file your 2012 income tax returns on or before June 15, 2013, stop here. No further reading is necessary.

Payment deadline for Americans abroad: June 15, 2013

A slight digression here. Getting an extension of time to file a tax return is not the same as getting an extension of time to pay the tax due. Ordinarily, your tax return is due on April 15, and the IRS expects you to send in a check on or before April 15, 2013 to settle up any tax due for 2012.

But Americans abroad not only get an automatic two month extension of time to file their 2012 income tax returns, they get a two month extension of time to pay their 2012 income tax liabilities. ((Treasury Regulations Section 1.6081-5(a).))

Form 4868 extension to October 15, 2013

Everyone–living in the USA or abroad–can use Form 4868 to get an extension of time to file tax returns. The extension is good for six months from the default filing deadline of April 15, 2013. That puts the filing deadline at October 15, 2013 for filing your tax returns.

You get this extension to October 15, 2013 by filing Form 4868 before the filing deadline that applies to you.

So for an American living in the USA, the April 15, 2013 deadline applies and Form 4868 must be filed before April 15, 2013.  Otherwise you’re too late in applying for an extension.

If you are an American living abroad, your automatically extended filing deadline is June 15, 2013. You have to get your Form 4868 filed before June 15, 2013. But filing on or before June 15, 2013 doesn’t get you (the American living abroad) six months of extension. It only gets you four months of extension. From the instructions to Form 4868:

Taxpayers who are out of the country. If, on the regular due date of your return, you are out of the country and a U.S. citizen or resident, you are allowed 2 extra months to file your return and pay any amount due without requesting an extension. For a calendar year return, this is June 15, 2013. File this form and be sure to check the box on line 8 if you need an additional 4 months to file your return.

So your deadline as an American living abroad, too, is October 15, 2013 based on filing Form 4868.

And yes. I know what you’re saying. You’re saying,

“Hey Phil, the Treasury Regulations say that you get the automatic deadline to June 15, 2013 only if your home is really, truly outside the USA but the Form 4868 instructions just say you have to be out of the country on the regular due date, so doesn’t that mean if I’m a tourist abroad on April 15 I get this automatic extension?”

My response? “Welcome to TaxLogic, which is not the same as real logic. (Heavy sigh). Rely on the Instructions.”

Relying on the Instructions is like getting your religion from the guy wearing the robe and the funny hat instead of getting it from the Good Book. We do it, but we feel weird about doing it.

Concurrent extensions

The two-month extension (to June 15) that applies to Americans abroad runs concurrently with the automatic six-month extension (to October 15) that applies to everyone. Treasury Regulations Section 1.6084-1(a) says:

An individual who is required to file an individual income tax return will be allowed an automatic 6-month extension of time to file the return after the date prescribed for filing the return if the individual files an application under this section in accordance with paragraph (b) of this section. In the case of an individual described in §1.6081-5(a)(5) or (6), the automatic 6-month extension will run concurrently with the extension of time to file granted pursuant to §1.6081-5.

An American living abroad is an “individual described in §1.6081-5(a)(5)” who gets the automatic six-month extension. So an American living abroad has two filing extensions running concurrently. Both start with the default filing deadline of April 15, 2013. One of them runs for two months and doesn’t require any paperwork. The other one runs for six months, and requires paperwork–Form 4868.

Extending to December 15, 2013

All of that was the unnecessary excess information I promised.  But good stuff, right?  Now you understand how you arrived at October 15, 2013, with a valid extension of time.  You, the American abroad, filed a Form 4868 on or before June 15, 2013, and you paid up your 2012 tax liability at the same time.

To get yourself an extra two months of time to file your 2012 income tax return, you have to write a letter.  Yes, we are off the fairway and into the rough.  We are outside the scope of published tax forms for invoking tax procedures.

First, let’s look at the law so you can see what it requires.

Treasury Regulations Section 1.6081-1 (Extension of Time for Filing Returns) is where you look in the Holy Tax Scriptures for the answer. Section 1.6081-1(a) gives the IRS the authority–in its discretion–to grant you an additional extension of time. Section 1.6081-1(b) tells you how to do it, and what to put in the letter.

For your late-night reading pleasure, here is the entire Section:

1.6081-1(a) In General.

The Commissioner is authorized to grant a reasonable extension of time for filing any return, declaration, statement, or other document which relates to any tax imposed by subtitle A of the Code and which is required under the provisions of subtitle A or F of the Code or the regulations thereunder. However, other than in the case of taxpayers who are abroad, such extensions of time shall not be granted for more than 6 months, and the extension of time for filing the return of a DISC (as defined in section 992(a)), as specified in section 6072(b), shall not be granted. Except in the case of an extension of time pursuant to Section 1.6081-5, an extension of time for filing an income tax return shall not operate to extend the time for the payment of the tax unless specified to the contrary in the extension. For rules relating to extensions of time for paying tax, see Section 1.6161-1.

1.6081-1(b) Application For Extension Of Time—

1.6081-1(b)(1) In General.

Under other sections in this chapter, certain taxpayers may request an automatic extension of time to file certain returns. Except in undue hardship cases, no extension of time to file a return will be allowed under this section until an automatic extension of time to file the return has been allowed under the applicable section. No extension of time to file a return will be granted under this section for a period of time greater than that provided for by automatic extension. A taxpayer desiring an extension of the time for filing a return, statement, or other document shall submit an application for extension on or before the due date of such return, statement, or other document. If a form exists for the application for an extension, the taxpayer should use the form; however, taxpayers may apply for an extension in a letter that includes the information required by this paragraph. Except as provided in § 301.6091-1(b) of this chapter (relating to hand-carried documents), the taxpayer should make the application for extension to the Internal Revenue Service office where such return, statement, or other document is required to be filed. Except for requests for automatic extensions of time to file certain returns provided for elsewhere in this chapter, the application must be in writing, signed by the taxpayer or his duly authorized agent, and must clearly set forth—

1.6081-1(b)(1)(i)

The particular tax return, information return, statement, or other document, including the taxable year or period thereof, for which the taxpayer requests an extension; and

1.6081-1(b)(1)(ii)

An explanation of the reasons for requesting the extension to aid the internal revenue officer in determining whether to grant the request.

1.6081-1(b)(2) Taxpayer Unable To Sign.

In any case in which a taxpayer is unable, by reason of illness, absence, or other good cause, to sign a request for an extension, any person standing in close personal or business relationship to the taxpayer may sign the request on his behalf, and shall be considered as a duly authorized agent for this purpose, provided the request sets forth the reasons for a signature other than the taxpayer’s and the relationship existing between the taxpayer and the signer.

1.6081-1(c) Effective/Applicability Dates.

This section applies to requests for extension of time filed after July 1, 2008.

Write a letter

Write a letter to the Internal Revenue Service. The key ingredients are (1) the specific tax return that you’re attempting to get an extension for; and (2) the reason you need the extension. Quoting from above:

A taxpayer desiring an extension of the time for filing a return, statement, or other document shall submit an application for extension on or before the due date of such return, statement, or other document. If a form exists for the application for an extension, the taxpayer should use the form; however, taxpayers may apply for an extension in a letter that includes the information required by this paragraph.

They’ve told you to write a letter (because a form does not exist), and they’ve told you to provide the information required by “this paragraph.” That information is:

1.6081-1(b)(1)(i)

The particular tax return, information return, statement, or other document, including the taxable year or period thereof, for which the taxpayer requests an extension; and

1.6081-1(b)(1)(ii)

An explanation of the reasons for requesting the extension to aid the internal revenue officer in determining whether to grant the request.

The particular tax return that you need to extend is the “2012 Form 1040”. If indeed that is the tax return you’re working with.

The reasons you need an extension are usually along the lines of “I need more time to gather income and expense information necessary to accurately prepare my 2012 income tax returns. I live outside the United States and this takes additional time to accomplish successfully due to communication and mailing delays.” Or something like that, right?

Where to send the letter

You send the letter to the IRS Service Center where you ordinarily file your income tax returns. See Treasury Regulations Section 1.6081-1(b), which says, in relevant part:

Except as provided in §301.6091-1(b) of this chapter (relating to hand-carried documents), the taxpayer should make the application for extension to the Internal Revenue Service office where such return, statement, or other document is required to be filed.

For an American abroad, this is:

Department of the Treasury
Internal Revenue Service Center
Austin, TX 73301-0045

How to send it

Do every conceivable proof of mailing that you can do. If you do not hear from the IRS, you win.

Do not wait until October 15 to mail that letter from a foreign country. MAIL IT NOW. Everyone thinks “If I have it postmarked on that date I have filed my IRS stuff on that date.” Ain’t necessarily so, Bucky.

“Postmarked by the loving Postal Service in [INSERT COUNTRY] on October 15” does not mean, necessarily, that the IRS will treat you as having timely filed your request on or before October 15.

Mail it way, way early. Be smart.

You won’t hear from the IRS

If you do this, you won’t hear from the IRS. No file-stamped copy. Just silence.

Filing your tax return

Attach a copy of that letter (festooned with copies of all of the various proofs of mailing that you can muster) to your tax return when you file.

Also attach a copy of that Form 4868 that you filed on or before June 15, 2013.

Also write “Taxpayer Abroad” on the top of Form 1040, Page 1.

Merry Christmas

Congratulations. If you’ve read this far, it is December 15, 2013, and you just finished your 2012 income tax returns. It’s almost 2014, and time for you to start thinking about your 2013 income tax returns.

Americans Living Abroad