Non-U.S. founders face unique challenges when seeking extra time to file U.S. tax returns—both personal (Form 1040-NR) and entity (Form 1120, 1120-F, 1120-S, 1065). The IRS grants an automatic six-month extension, but pitfalls abound: missing the right form, underpaying estimates, or misunderstanding treaty provisions. This guide explains exactly what international founders must know for 2025.
Introduction
International founders often juggle foreign regulations, U.S. withholding, and unfamiliar IRS procedures. Filing for an extension—using Form 4868 (individuals) or Form 7004 (entities)—grants six extra months, but you must still estimate and pay U.S. tax due by the original deadline. Get it wrong, and you’ll incur penalties, interest, or even jeopardize treaty benefits.
Relevant IRC Codes & Definitions
- IRC §6081 – Federal authority for extensions of time to file returns.
- IRC §6651(a) – Penalties for failure to file and failure to pay by original due date.
- IRC §1446 – Withholding on effectively connected income allocable to foreign partners/shareholders.
- IRC §871 & §875 – Tax treatment of nonresident aliens and foreign corporations.
- Treaties – U.S. income tax treaties may reduce withholding, but do not extend filing deadlines.
IRS & State Form References
| Return Type | Extension Form | Original Due Date | Extended Date | Payment Requirement |
|---|---|---|---|---|
| Nonresident Individual (1040-NR) | Form 4868 | Apr 15, 2025 | Oct 15, 2025 | Pay 90 % of estimated U.S. tax |
| Foreign Corp Income (1120-F) | Form 7004 (1a) | Apr 15, 2025 | Oct 15, 2025 | Pay 100 % estimated liability |
| S-Corporation (if treaty-eligible) | Form 7004 (1a) | Mar 15, 2025 | Sep 15, 2025 | Pay 100 % of U.S. tax |
| Partnership (1065) | Form 7004 (1b) | Mar 15, 2025 | Sep 15, 2025 | Pay withholding on exported K-1s |
| Foreign-Owned LLC (disregarded or corp) | 7004 or 4868 | Depends on classification | +6 months | Per entity rules |
Real-World Example
Case Study:
– Founder X, a German resident, owns 100 % of a single-member Delaware LLC taxed as a corporation (1120-F).
– By Apr 15, X files Form 7004 (Line 1a), estimates $30,000 U.S. tax, and pays $30,000 via EFTPS.
– By Oct 15, X files complete Form 1120-F, attaches treaty-claim documentation, and avoids penalties.
Pitfall Avoided: Without extension, a late 1120-F would cost 5 % per month penalty plus 0.5 % interest.
Step-by-Step Guide for International Filers
- Determine Your Tax Classification – 1040-NR, 1120-F, 1065, or 1120-S.
- Gather U.S. Identifier – EIN or ITIN; apply early if needed.
- Estimate U.S. Tax Liability – Include effectively connected income and withholding on distributions.
- Complete the Correct Form:
- Form 4868 for individuals (1040-NR).
- Form 7004 (line per entity type) for corporate/partnership.
- Submit Payment – EFTPS, check, or credit card by original due date.
- E-File or Mail – Many software support 4868/7004; mail to appropriate IRS center otherwise.
- Retain Confirmation – Save e-file acknowledgment or canceled check.
- Observe Treaty Disclosure – Attach Form 8833 if claiming treaty benefits, even on extension.
- File by Extended Date – Include “extension filed” checkbox and any treaty statements.
- Monitor State Requirements – Some states require separate extension requests.
Conclusion
International founders must treat extensions as distinct from payment obligations and treaty claims. File the proper form, pay the right amount, and attach treaty documentation on time. Do this, and you’ll secure extra preparation time without jeopardizing your U.S. standing or treaty benefits.
Call to Action
Need help estimating tax, filing an extension, or claiming treaty benefits?
Book your international tax session with Anshul Goyal, CPA EA FCA. We’ll handle your form selection, payment, treaty disclosures, and ensure full IRS compliance.
Disclaimer
This content is for informational purposes only and does not constitute legal, tax, or financial advice. Extension rules and treaty applications can be complex for nonresidents. Always consult a licensed CPA or international tax attorney before filing extension forms or treaty claims.
Anshul Goyal, CPA EA FCA is a U.S. Certified Public Accountant, IRS Enrolled Agent, and Chartered Accountant in India. He specializes in cross-border compliance, treaty navigation, and extension planning for international founders.
FAQs (Top 5 High-Searched)
1. Can a nonresident alien file Form 4868?
Yes—for Form 1040-NR by Apr 15, 2025.
2. Is treaty benefit documentation required with extension?
Yes—attach Form 8833 or treaty disclosure with the extended return.
3. Does extension affect withholding on distributions?
No—Form 8805/1042-S deadlines remain unchanged.
4. Can I pay estimated tax after extension due date?
No. Payment is due by original deadline to avoid interest.
5. Do U.S. states require separate extensions for non-residents?
Some do; verify nexus states and file state extension forms as needed.