The IRS form 7004 is called Application for Automatic Extension of Time to File Certain Business Income tax Information and Other Returns. The name itself suggests that this form can be used by business entities who have this desire or the requirement of filing a legitimate 5 to 6 months of Federal tax extension. Some of the most important things that one needs to know in regards to this form have been explained below.
Once you file form 7004 online, the tax extension shall be permitted and it will be considered valid only if the following criteria are fulfilled:
• It is important to fill up the entire form properly without any kind of ambiguity or without any chances of interpretation.
• Tax estimate needs to be correct if it is applicable.
• It is necessary to file form 7004 online or in person within the deadline or the due date. Apart from this, it is also important to pay the tax amount that is owed correctly.
Determining the Extension Period
When filing form 7004, it is important for an individual to check the Line number and the Part number that he or she falls under in order to judge his or her time eligibility.
• 5-month extension- An individual is eligible for a tax extension of five months if the return type matches with Part I and Line 1a of the form.
• 6-month extension- An individual is eligible for a tax extension of six months if the return type matches with the ones available on Part II Line 1b of the form.
It is also necessary for the tax payer to have a close look at line 1 and line 4 of the form prior to making the choice of a specific extension period.
As has already been mentioned, Line 2 and line 4 of the form list the exceptions which are applicable and they have been defined below:
• Line 2: Line 2 of the form is for the foreign corporations who do not have a place or an office for conducting business throughout the United States.
• Line 4: This line is applicable for the selected domestic and foreign partnerships and corporations.
If the IRS considers that a particular extension needs to be cancelled, it has all rights to do so. In this case, a notice of extension termination will surely be mailed to the entity or the person 10 days before the extension termination date.
The Procedure of Filling the Form
The form can easily be filled both offline and online, online filling can conveniently be carried out by using the official IRS website completely free of cost. Manual filling can also be carried out by getting the form from the IRS outpost or by getting a print of the form from the IRS website. Once the form is filled in manually, it is sent back to the IRS authority through mail. No signature is needed when filing the form online or offline.