What is a tax filing extension?

Did you know you can delay the filing of your prior year return all the way until October 15 without any penalty?

You do still have to pay whatever tax you owe for the prior year by tax day, April 15, but you can delay the filing of your prior year return all the way until October 15.

For 80% to 90% of student loan borrowers, filing an extension is a very smart strategy. In other words, most folks pursuing an IDR forgiveness plan should want an extension, because it means lower payments.

By filing an extension, you're not "late" on your taxes, you're just putting off the filing until the best time for you and your loan situation.

Perhaps 10% to 20% of borrowers need to file on time, usually due to filing their prior return jointly when it should be separately. Due to the recertification extension until September 2024, that reduced the urgency of many folks with prior year joint returns getting them submitted right away.

If your IDR payment is based on your 2018 tax return from before the pandemic, and you don't have to recertify anymore until 2025, an extension doesn't hurt anything.

Also note that an extension doesn't mean you get filed in mid October. It means you can file it anytime between April 15 and October 15.