IRS Form 4768: Requesting Extensions Made EasyPersonal Taxes
We may receive a commission if you sign up or purchase through links on this page. Here's more information.
IRS Form 706 and Form 4768 aren’t as important as before the Tax Cuts and Jobs Act doubled the estate tax exemption in 2018. The filing threshold has been gradually increasing every year, and it is currently at $12.92 million.
Consequently, estate administrators don’t have to file estate tax returns or request extensions if they represent an estate with a gross estate value below this threshold.
It’s currently unclear whether Congress will renew the TCJA after it expires in 2025. The estate tax exemption will revert to its pre-2017 level if the TCJA isn’t renewed, increasing the importance of Form 706 and Form 4768.
We’ll show you how to request extensions with IRS Form 4768 if you cannot file an estate tax return on time or pay the due taxes.
- The estate executor can request an automatic six-month extension with IRS Form 4768.
- The IRS may approve an extension even if Form 4768 is filed after the deadline.
- The maximum extension to pay an executor can request on IRS Form 4768 is limited to 12 months.
Table of Contents
The Purpose of Form 4768
Getting an estate’s finances in order and compiling all the documents you must include with an estate tax return is time-consuming.
The filing deadline for Form 706 expires nine months after the decedent’s death, so sometimes, an executor doesn’t have enough time to settle the estate’s tax liability and file the return in time.
Form 4768’s primary purpose is to enable an executor to request an automatic six-month extension if they need more time to complete an estate tax return.
Some states, like Massachusetts, Oregon, or New York, impose taxes on estates and require executors to file Form 706 even if they don’t owe federal taxes.
Estate administrators from states that require estates to file Form 706 at the state level can request filing extensions on Form 4768. Please note that the filing exemption threshold varies by state and is considerably lower than the federal estate tax exemption.
Estates that report their taxes on Form 1041 cannot request the filing extension with Form 4768.
Filing Extension Types
Completing and filing Form 4768 allows an estate’s executor to extend the filing deadline for Form 706 for six months. The form distinguishes between three extension types depending on when the form is filed and the executor’s location at the time of filing.
- Automatic extension: The IRS automatically extends the filing deadline for Form 706, Form 706-A, 706-NA, and 706-QDT by six months if Form 4768 is filed on time. The due dates for these forms aren’t the same, so you must check when the form you must file is expected. Executors who request an automatic extension with Form 4768 don’t have to explain why they’re filing this form.
- Extension for Cause: An executor can file Form 4768 after the filing deadline if they have sufficient cause for missing it. In this case, an executor must attach a statement to the form explaining why they didn’t request an automatic extension on time and list the reasons they failed to request the extension before the deadline.
- Additional extension: Estate executors can postpone filing Form 706 for longer than six months if they’re not in the country. Besides Form 4768, the request should include a statement explaining why the executor cannot file the estate tax return on time.
The IRS will only contact the estate executor after Form 4768 is filed if their request is denied.
Extension to Pay – Requirements and Limitations
Estates that can’t pay the entire balance by the time their taxes are due can request an extension to pay on Form 4768.
The maximum extension period is twelve months, but an estate can extend paying taxes for up to four or ten years if it can provide the IRS with a reasonable cause.
The duration of the extension period for estates that make Section 6166 election and Section 6163 election is different. The IRS grants the extension to pay to estates under the following conditions:
- The executor cannot collect the estate’s liquid assets, which are sufficient to pay the outstanding tax debt, despite reasonable efforts because the assets are located in different jurisdictions.
- The estate doesn’t have enough cash to pay taxes because it will receive payments from copyright royalties or similar assets in the future and cannot borrow against these assets without a loss.
- The executor cannot ascertain the gross estate value because collecting its assets requires litigation.
- The estate doesn’t have enough funds to pay taxes even though the executor attempted to convert its assets into cash.
IRS Form 4768 At a Glance
Form 4678 makes requesting extensions easy; you can complete it in less than thirty minutes. However, writing a statement accompanying the form might complicate the filing process.
Here’s a brief overview of the steps to complete the form.
The decedent and estate executor information should be entered in the form’s top section.
The form preparer must include the decedent’s name and date of death, the executor’s name, the name of the application filer (other than the estate executor), and the estate tax due date in this part.
The next step is to indicate the form for which a filing extension is requested and the extension type. You must click on appropriate checkboxes to complete this part of the form.
You don’t have to include a statement if you’re using Form 4768 to request an automatic extension.
However, your application must include a statement explaining why you couldn’t request the filing extension on time or why it was impractical or impossible to file the estate tax return on time.
Estate representatives outside the country must apply for an automatic six-month extension before filing another Form 4768 and applying for an additional extension.
Executors applying for an extension of time to pay estate taxes must complete this part of the form.
Filling out the section is straightforward, as you must enter the requested extension date (up to a year from the date taxes are due) and indicate why you’re submitting the request by checking the appropriate box.
Hence, you should check a different box if you’re filing this form because of a Section 6166 installment payment, taxes due by Form 706’s filing deadline, taxes due as a result of an amended return, or taxes due after an additional review of the estate tax return.
The form instructs the preparer to confirm whether the gross estate is unascertainable and enter 0 on Line 3 of the following section if it is.
The IRS will continue charging interest on the due amount after it approves an extension to pay, so all future tax payments must account for the interest rate.
You must estimate the estate or GST tax if you request the extension to pay before filing Form 706. Moreover, you must provide the cash shortage amount supported by the payment plan for the extension period and a statement of already distributed assets.
These two values should be on the first two lines of the form’s Part IV, and you must subtract Line 2 from Line 1 to calculate the balance due. The extension to pay applies only to the cash shortage amount indicated on Line 3 in this section of the form.
Filing Deadlines and Methods
An executor must request an extension before the deadline for filing a form from the IRS Form 706 series.
Hence, Form 4768 is due nine months after the date of the decedent’s death if you’re requesting a filing extension for Form 706. However, an executor has only six months to request an extension for filing Form 706-A.
Estates that have to file Form 706-QDT must apply for an extension between January 1 and April 15 of the year following the year in which a taxable event took place.
Alternatively, the estate executor can file Form 4768 nine months after the death of the decedent’s surviving spouse.
The IRS doesn’t allow estate representatives to e-file or fax Form 4768, and you must send its paper version to the Internal Revenue Center in Florence, Kentucky.
Frequently Asked Questions
The estate executor will receive Form 4768-A from the IRS after they submit the application for an extension to pay on Form 4768.
To appeal the disallowance of an extension to pay, they must send this form along with a statement explaining why they disagree with the IRS’s decision and other documents proving the estate’s inability to pay taxes to the IRS ten days after receiving the decision.
The IRS can charge late filing or failure to pay penalties if an estate executor doesn’t submit Form 4768 on time. These penalties apply even if the executor uses the form to apply for an extension for cause.
Estate executors can use IRS Form 4768 to request a single six-month automatic extension. They cannot file another Form 4768 after the extension period expires to postpone paying estate taxes or filing Form 706 for an additional six months.
Besides estate executioners, CPAs, agents with power of attorney, enrolled agents, heirs, and trustees can complete and sign IRS Form 4768.
Obtaining Estate Tax Extensions with IRS Form 4768
All estates that must pay estate tax and submit the estate tax return on Form 706 can use IRS Form 4768 to request an extension.
However, the documents you must attach to this form will depend on the version of Form 706 you must send to the IRS and other factors.
The IRS will automatically grant a six-month filing extension as soon as Form 4768 is filed. However, the application process is more complex for estates that request an extension of the time to pay taxes.
To avoid having their application rejected, estate executors must understand under which circumstances they can postpone paying or filing federal estate taxes.
Still, you should only use this form if you cannot meet your estate tax obligations in time due to justifiable reasons.
Logan is a practicing CPA and founder of Choice Tax Relief and Money Done Right. After spending nearly a decade in the corporate world helping big businesses save money, he launched his blog with the goal of helping everyday Americans earn, save, and invest more money. Learn more about Logan.