Filing U.S. taxes as a business owner is rarely simple. For non-U.S. founders managing American companies from abroad, the process can be even more confusing. Between tight IRS deadlines, complex forms, and international tax rules, it is easy to feel overwhelmed. That is where tax extensions come in. Filing a U.S. tax extension can give you more time to get your documents in order and avoid costly penalties.
At Bookmate, we automatically include tax extension filing in every plan. This article explains why U.S. tax extensions matter, who needs them, and how Bookmate makes the entire process seamless.
What Is a U.S. Tax Extension?
A U.S. tax extension is a formal request to the IRS for more time to file your federal tax return. It does not give you more time to pay any taxes you might owe, but it does protect you from late filing penalties. If granted, the extension typically gives you an additional six months to file your return.
For example:
- LLCs and C Corporations with a calendar year end have a regular deadline of April 15.
- Filing an extension gives you until October 15 to submit the return.
There are two main IRS forms used to request extensions:
- Form 7004: For businesses, including LLCs, partnerships, and corporations.
- Form 4868: For individuals, including nonresident taxpayers who must file Form 1040-NR.
Bookmate helps clients with both types of extensions, depending on your structure.
Why Extensions Are So Important
If you are not ready to file by the original deadline, not requesting an extension can be risky. Here are a few reasons why tax extensions matter:
1. Avoid Late Filing Penalties: The IRS charges high penalties for late filings. For example:
- Missing Form 5472 for a foreign-owned LLC can result in a $25,000 penalty per year.
- Missing Form 1065 for a partnership can lead to $220 per partner, per month, up to 12 months.
- Individual filers (Form 1040-NR) face a penalty of 5 percent of the unpaid tax per month, up to 25 percent. Filing an extension protects you from these penalties, even if your return is not yet complete.
2. More Time for Accurate Reporting: Many founders rush to meet the deadline and end up making mistakes. Filing an extension gives you the breathing room to gather missing documents, clarify transactions, and ensure your filings are accurate.
3. Peace of Mind When Working Across Time Zones: If you are based outside the U.S., coordinating your documents and working with U.S.-based tax teams can take longer. Extensions make it easier to work at a pace that fits your schedule without falling behind on compliance.
4. Useful for Complex Structures or Late Bookkeeping: If your business has multiple owners, cross-border payments, or catch-up bookkeeping needs, an extension ensures you have enough time to handle these complexities properly.
How Bookmate Handles Extensions Automatically
At Bookmate, we do not wait for clients to ask for extensions. If your return is not complete by the filing deadline, we file the extension for you automatically. This is included in every tax plan at no extra charge.
Here is how our process works:
Step 1: We Track Your Deadline When you become a Bookmate client, we record your business structure, ownership, and tax year. This helps us know exactly when your return is due and whether you need Form 7004 or 4868.
Step 2: We Prepare the Extension for You Our team gathers the basic information needed and files the appropriate extension form electronically. You do not need to fill anything out yourself.
Step 3: You Get a Confirmation Once your extension is accepted, we send you a confirmation email with the new deadline. This gives you peace of mind that your return is protected from penalties.
Step 4: We Keep Working on Your Return With the extension filed, we continue preparing your return. You can submit documents, ask questions, and work with us without rushing. When the return is ready, we e-file it for you before the extended deadline.
Who Needs an Extension?
Most Bookmate clients benefit from an extension if:
- They start the filing process close to the deadline
- Their books are not up to date
- They are waiting on international bank statements, ownership documents, or 1099s
- They are unsure which forms they need and want to confirm first
Even if you think your situation is simple, an extension provides a valuable safety net.
Extensions Are Included at No Extra Cost
Many tax services charge extra for filing extensions or leave the responsibility with you. At Bookmate, we think that creates unnecessary risk. That is why every tax filing plan includes:
- Automatic extension filing
- Deadline tracking
- Confirmation of submission
- No extra fees or hourly charges
Our job is to keep you compliant with the IRS, not nickel and dime you during a stressful season.
Need More Time?
Tax extensions are not a sign of disorganization. They are a smart strategy for international founders who want to file correctly and avoid penalties. At Bookmate, we file them for you automatically so you can focus on running your business.
If you are unsure whether you need an extension, talk to us today. We will walk you through your next steps and help you stay on track.
Every tax situation is different. Book a free consultation here, or learn more at trybookmate.co.
