Can I Avoid Offset?

[selbym]

I have an extension to file my 2024 US taxes, so I need to file in October. I'm joint filing with my husband. He has no income to report, but based on my teacher income here in Jordan, we stand to recieve a refund of about $3000 because of our three kids. The problem is that I have an old student loan that's been in default since 2012 or so. Because the hold on the Department of Education taking refunds for defaulted student loans has been removed, I know that my refund will be taken if I file my taxes now. I've been in communication with the Dept. of Education and I'm starting the process of rehabilitating the loan. I was told that after 4 consecutive payments, the Dept of Education will not offset. My bank is scheduled to mail the 1st payment July 1. That means that my 4th payment probably won't be processed until mid to late October, if not November. What could be a work around for me to submit my tax return and still recieve my refund? 

[DoninGA]

Since you are receiving a tax refund, you can file your tax return at any time, without penalty, on or before October 15, 2028.

If you file your tax return after October 15, 2025, it cannot be e-filed using TurboTax, it can only be printed and mailed.

If you want to wait and file until after the end of November 2025, then you should print the complete return before October 15, 2025, if using the TurboTax online editions, as the online editions will close after that date.

[selbym]

Thank you very much, that is information I am delighted to recieve. Just to confirm, my tax return will not be considered late if I file it as soon as I can confirm that the Dept. of Education will not offset my refund? ...so in general, if you don't owe taxes and you stand to recieve a refund, you do not need to file for an extension? Or I did the right thing in applying for an extension?

[DoninGA]

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@selbym wrote:

Thank you very much, that is information I am delighted to recieve. Just to confirm, my tax return will not be considered late if I file it as soon as I can confirm that the Dept. of Education will not offset my refund? ...so in general, if you don't owe taxes and you stand to recieve a refund, you do not need to file for an extension? Or I did the right thing in applying for an extension?

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As long as you have a valid tax refund and there are no offsets by the IRS which would remove the refund, then an extension would no be required. 

If, for example, you will have taxes owed on the 2024 tax return and you file the tax return after April 15, 2025, then there would be a failure to pay penalty and interest owed on the taxes owed until they were paid.  The extension request only gives you an extra six months to file the tax return.  It does not give an extension to pay any taxes owed.

[Hal_Al]

It is too late to file an extension. The deadline was 4-15-25.  You are now late.  But, there is no penalty because you do not any tax. 

Q. What could be a work around for me to submit my tax return and still receive my refund? 

A. Mail in your return after  the 4th payment is processed in mid to late October.  There is still no penalty (other than the long wait for your refund because you did not e-file).