Filing by October 15? Your Extended 2025 Return Has New Deductions in It

If you filed Form 4868 back in April, your 2025 individual return is due Thursday, October 15, 2026. That date is a hard stop — there is no extension beyond it for regular filers. And this year there’s an unusual twist: your 2025 return is the first one filed under the new tax law, and it contains brand-new deductions that apply retroactively to 2025. Filing in a rush without them means leaving your own money with the IRS.

First, the mechanics people get wrong

The extension you filed in April extended your time to file, not your time to pay. Your 2025 tax was still due April 15, 2026. That means:

• If you owe and haven’t paid, the failure-to-pay penalty (0.5% of the unpaid tax per month) and interest at 7%, compounded daily, have been running since April — even though you did everything right by extending.
• If you miss October 15, the far bigger failure-to-file penalty kicks in: 5% of the unpaid tax per month, up to 25% — ten times the pay penalty. Once a return is more than 60 days late, the minimum penalty is $525 or 100% of the tax due, whichever is less.
• If you’re owed a refund, there’s no late-filing penalty at all — but you must file within three years or the refund is forfeited to the Treasury. Don’t donate it.

The new deductions on your 2025 return

The One Big Beautiful Bill Act, signed in July 2025, changed the 2025 tax year retroactively. If any of these apply to you, make sure they’re actually on the return before you file:

• Higher standard deduction — $15,750 for single filers and $31,500 for married filing jointly for 2025.
• Deduction for tip income — workers in tipped occupations can deduct up to $25,000 of qualified tips, subject to income phase-outs. This applies whether or not you itemize.
• Deduction for overtime pay — up to $12,500 ($25,000 for joint filers) of the premium portion of overtime, phasing out above $150,000 of income ($300,000 joint).
• Extra deduction for seniors — taxpayers 65 and older get up to $6,000 more, phasing out above $75,000 of income ($150,000 joint).
• Bigger SALT deduction — the state-and-local-tax cap jumped from $10,000 to $40,000 for 2025 (phasing down for incomes above $500,000). If you skipped itemizing in past years because of the old cap, rerun that math for 2025 — especially in high-tax states.
• Car loan interest — up to $10,000 of interest on a loan for a new, U.S.-assembled personal vehicle is deductible, subject to income limits.

One warning in the other direction: several clean-energy breaks ended after 2025 — the EV credit stopped for purchases after September 30, 2025, and the residential solar credit ended December 31, 2025. Whatever you did in 2025 still counts on this return; just don’t plan around those credits for 2026.

Finishing an extended return, in order

1. Gather the stragglers. Extended filers usually waited on K-1s from partnerships or S corporations — those became final September 15. Brokerage 1099s, corrected forms, and foreign account information round out the pile.
2. Report all income, even without a form. Freelance income under reporting thresholds, crypto sales, and marketplace income are still taxable; the IRS matches what it can and asks about the rest.
3. Max out what’s still open. A SEP-IRA for self-employed filers can still be funded for 2025 right up to the October 15 extended deadline — one of the very few remaining ways to cut a 2025 bill.
4. Pay electronically with the filing. IRS Direct Pay posts same-day and stops the penalty clock. If you can’t pay in full, file anyway and set up an installment agreement — the failure-to-file penalty is the one that hurts, and filing kills it.
5. Check your state. Most states honor the October date, but not all, and state penalties stack on top of federal ones.

If you already know you’ll owe more than you can pay

File on time anyway. The difference between “filed but can’t pay” and “didn’t file” is roughly a factor of ten in penalties, and the IRS offers payment plans that most people qualify for online in minutes. The worst outcome available in October is silence.