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11:28AM

Tax Tip: Filing an Extension

iStock/ThinkstockWe all need to file our taxes but sometimes the required documents come late, there's a mistake or life just gets in the way. When that happens, you need to let the Internal Revenue Service know that you'll be needing an extension.

IRS spokesperson Yadira Nadal says all the required paperwork can be found on IRS.gov.

"In a matter of minutes, anyone regardless of income can use this free service to electronically request an extension," she says.

But take note: Even if you file for an extension, you still need to pay.

"A request for an extension will give extra time to file a tax return, not extra time to pay any taxes owed. So by filing either a regular tax return or requesting an extension by the April 18 deadline, taxpayers will avoid the late filing penalty," Nadal says.

It's not always easy, however, to know for sure how much income to report when filing your taxes later in the year. IRS spokesperson Eric Smith says give your best guess.

"Typically, if you've made a reasonable estimate of your tax liability, that's going to be accepted," Smith says.

An accurate guess will also help you avoid paying penalties and possibly being audited.

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