What Form 8868 Is For
Form 8868 is an IRS form used by tax-exempt organizations, private foundations, and certain trusts to request an automatic six-month extension to file their annual exempt organization return. It provides additional time to complete information returns without affecting the organization’s tax liability or tax-exempt status. The Internal Revenue Service allows nonprofit groups and governmental entities to file Form 8868 six months after the original due date if more time is needed to gather financial records or finalize accounting period data.
When You’d Use Form 8868
Exempt organizations use this extension form when they cannot complete their organization’s tax return by the regular due date. Nonprofit organization filers may need the extra time to verify estimated tax payments, review information returns, or confirm refundable and nonrefundable credits. The IRS recommends submitting the form before the tax year ends to avoid late filing penalties. Only one return code applies per form, and each organization must file a separate form for every return type or fiscal tax year.
Key Rules or Details for 2023
- Automatic period: The Internal Revenue Service grants an automatic six-month extension for most exempt organization returns if the form is properly completed and filed by the original due date. The extension does not postpone any taxes owed.
- Payment requirements: Organizations must estimate their tentative tax and pay any balance by the original due date to avoid interest. Tentative tax reduced by refundable and nonrefundable credits must still be settled on time.
- Separate form for each return: Each organization, including private foundations or group return filers, must complete a separate form for each tax year or return type. Complimentary extension requests cannot be combined into one filing.
- Electronic filing: The IRS recommends electronic filing because it provides faster acknowledgment when the form is accepted. Organizations can e-file Form 8868 through approved software using their taxpayer identification number and electronic funds withdrawal option for payments.
- Paper filing option: If e-filing Form 8868 is unavailable, the paper format can be mailed to the Internal Revenue Service mail address listed in the instructions.
- Return codes: Each exempt organization return has a specific return code on the form. The correct return code ensures that the request is linked to the right type of tax forms filed later. Using only one return code per submission helps the IRS audit function process the extension correctly.
- IRS confirmation: Once the form is approved, filers receive an acknowledgment from the Internal Revenue Service confirming that their extension request was accepted.
Browse more tax form instructions and filing guides in our Forms Hub.
Step-by-Step (High Level)
Step 1: Confirm Eligibility
Verify that your organization qualifies to file an exempt organization return, such as Form 990, 990-EZ, 990-PF, or 990-T. Ensure your tax year-end aligns with the current accounting period and that your form is submitted by the original due date.
Step 2: Gather Required Information
Collect organization details, including your taxpayer identification number, tax year, return code, estimated tax payments, and tentative tax amounts. Ensure your records accurately reflect your tax liability and any refundable credits that reduce it.
Step 3: Complete the Correct Part of the Form
Form 8868 includes multiple sections depending on the return being extended. You must complete either Part I for exempt organizations or Part II for employee benefit plans. Ensure you mark the correct return code and follow the Internal Revenue Code guidelines.
Step 4: Pay Any Tentative Tax Due
Calculate your tentative tax reduced by any refundable credits and make payment using the electronic funds withdrawal system or other approved methods. Paying on time helps avoid interest and additional costs related to underpayment penalties.
Step 5: Submit the Form Electronically or by Mail
E-file Form 8868 through IRS-approved software for quicker processing, or use paper filing if your form cannot be transmitted electronically. Send it to the address noted in the form instructions for your region for paper filing.
Step 6: Retain Confirmation and Records
Once your form is accepted, file your electronic filing receipt or certified mail confirmation. This documentation is proof of timely filing and may be required—send it for review.
Learn more about federal tax filing through our IRS Form Help Center.
Common Mistakes and How to Avoid Them
- Filing after the original due date: Late submission invalidates the automatic extension. To prevent late filing penalties, file Form 8868 several days before your original due date.
- Failing to pay estimated tax: The extension only covers paperwork, not payment. Always pay your tentative tax, reduced by any credits, before the due date to avoid interest.
- Using the wrong return code: If you list an incorrect code, the IRS may reject your request. Double-check that your return code matches the correct tax form.
- Submitting one form for multiple returns: Each exempt organization return requires a separate form. Filing multiple returns under one form can delay processing and void the extension.
- Incorrect taxpayer identification number: If your taxpayer identification number is missing or inaccurate, the Internal Revenue Service will reject the request. Verify your EIN before submitting.
- Technical errors in e-filing: If your electronic filing is rejected, retransmit rejected returns promptly after correcting errors. Do not delay resubmission because it may affect the form’s acceptance.
Learn more about how to avoid business tax problems in our guide on How to File and Avoid Penalties.
What Happens After You File
After filing, the IRS processes the extension automatically for eligible organizations. Electronic filers usually receive confirmation within hours once the form is approved. Paper filers should allow additional time for the Internal Revenue Service mail system to record and accept the form. If the form is received, the six-month extension applies immediately. Filers should still complete their organization’s tax return by the new due date to avoid penalties or audit inquiries. Tax professionals often recommend reviewing helpful resources and IRS instructions to ensure accuracy.
FAQs
Can I e-file Form 8868 if my organization uses paper filing for other tax forms?
Yes, the IRS recommends electronic filing because it confirms faster that your extension was accepted. Paper filing is available but takes longer to process.
How do I retransmit rejected returns after e-filing Form 886?
If your e-filing Form 8868 submission is rejected, correct any listed errors and retransmit rejected returns as soon as possible so that your form approval date remains valid.
When should I file an exempt organization return after receiving an automatic extension?
Once your extension is approved, file an exempt organization return by the extended due date, typically six months after the original due date listed on your form.
Why does the IRS require a return code on Form 8868?
Each return code identifies which type of exempt organization return the IRS should expect later. This code helps the audit function and processing teams link your extension correctly.
Where can I find helpful resources for using IRS Form 8868 2023?
Helpful resources include the official IRS instructions, online e-file providers, and Internal Revenue Code publications. These explain proper filing procedures and how to avoid interest or additional costs.
For more resources on filing or understanding prior-year IRS forms, visit our guide on Business Income Tax Forms.
