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President Donald Trump’s new tariffs will raise the prices on some goods more dramatically than others.
The costs for apparel like clothing and shoes; leather goods like gloves and handbags; and wool and silk products will increase by between 10% and 20% according to an analysis by the Budget Lab at Yale University.
The cost of motor vehicles could swell by over 8%.

Employees at a clothing factory in Vo Cuong, Bac Ninh province, in Vietnam.
SeongJoon Cho/Bloomberg via Getty Images

The Trump administration’s plan to slap steep tariffs on goods from dozens of countries is expected to spike prices for consumers. Some items, like leather goods, will see a bigger jump than others.
The overall impact on households will vary based on their purchasing habits. But most families — especially lower earners — are likely to feel the pain to some degree, economists said.

According to an analysis by the Budget Lab at Yale University, the average household will lose $3,800 of purchasing power per year as a result of all President Donald Trump’s tariff policies — and retaliatory trade actions by other nations — announced as of Wednesday.

That’s a “meaningful amount,” said Ernie Tedeschi, the lab’s director of economics and former chief economist at the White House Council of Economic Advisers during the Biden administration.
The analysis doesn’t include the 34% retaliatory tariff China announced Friday on all U.S. exports, set to take effect April 10. The U.S. exported nearly $144 billion worth of goods to China in 2024, the third-largest market for U.S. goods behind Canada and Mexico, according to the Census Bureau.

Clothing prices poised to spike

The garment industry is among the most susceptible to tariff-related price shocks.
Prices for clothing and shoes, gloves and handbags, and wool and silk products will all increase by between 10% and 20% due to the tariffs Trump has so far imposed, according to the Yale Budget Lab analysis. Tedeschi noted that some of these price increases could take 5 years or more to unfold.

Srdjanpav | E+ | Getty Images

The bulk of apparel and shoes sold in the U.S. is manufactured in China, Vietnam, Sri Lanka and Bangladesh, said Denise Green, an associate professor at Cornell University and director of the Cornell Fashion + Textile Collection.
Under the “reciprocal tariffs” Trump announced Wednesday, Chinese imports will face a 34% duty. Goods from Vietnam, Sri Lanka and Bangladesh face tariffs of 46%, 44% and 37%, respectively.
Taking into account the pre-existing tariffs on China totaling 20%, Beijing now faces an effective tariff rate of at least 54%.

“The tariffs are disastrous for the apparel industry worldwide, but especially for smaller countries with highly specialized garment manufacturing,” Green said.
A lot of clothing production has moved overseas over the last 50 years, Tedeschi said, but it’s “very unlikely” clothing and textile manufacturing will return to the U.S. from Asia in the wake of the new tariffs.
“People will still import clothing to a large extent, and they’ll have to eat the price increase,” he said.

Car prices are another pain point

Various Mercedes-Benz vehicles assembled in the “Factory 56” production hall.
Picture Alliance | Picture Alliance | Getty Images

The duties announced Wednesday are on top of other tariffs Trump has imposed since his second inauguration, including duties on automobiles and car parts; copper, steel and aluminum; and certain imports from Canada and Mexico.
The cost of motor vehicles and car parts could swell by over 8% according to the Yale Budget Lab analysis.
Bank of America estimated that new vehicle prices could increase as much as $10,000 if automakers pass the full impact of tariffs on to consumers.
More from Personal Finance:Economists say ‘value-added taxes’ aren’t a trade barrierTariffs are ‘lose-lose’ for U.S. jobs and industryWhy uncertainty makes the stock market go haywire
“Rising car prices are already a major pain point for the vast majority of Americans who live in an area where they need a car to get to work, school, their kids’ activities, and medical appointments,” said Erin Witte, director of consumer protection for the Consumer Federation of America.
“These tariffs will make it much worse, and will significantly reduce Americans’ choices about what car they want to buy,” she said.

Tariffs on specific commodities like aluminum and steel affect consumers indirectly, since the materials are used to manufacture a swath of consumer goods.
White House spokesman Kush Desai pushed back on analyses that prices will spike because of Trump’s tariff policy.
“Chicken Little ‘expert’ predictions didn’t quite pan out during President Trump’s first term, and they’re not going to pan out during his second term when President Trump again restores American Greatness from Main Street to Wall Street,” Desai said in an e-mailed statement.
Trump’s second-term tariffs are orders of magnitude larger than his first term, however.
The first Trump administration put tariffs on about $380 billion worth of goods in 2018 and 2019, according to the Tax Foundation. The tariffs so far imposed in Trump’s second term affect more than $2.5 trillion of U.S. imports, it said.

There’s also evidence that the first-term tariffs raised prices for some consumers.
Retail prices for the typical washing machine and clothing dryer rose by about 12% each — about $86 and $92 per unit, respectively — due to 2018 tariffs on imports of washing machines, according to a study by economists at the Federal Reserve Board and University of Chicago. The increased cost to consumers totaled $1.5 billion a year, the study found.

Tariffs are expected to raise the U.S. inflation rate

Economists also expect the overall U.S. inflation rate to jump due to tariffs.
American businesses that import goods from abroad will be the ones on the hook for paying the cost of tariffs, and economists anticipate that companies will pass at least some of those costs on to consumers.

The tariffs are disastrous for the apparel industry worldwide, but especially for smaller countries with highly specialized garment manufacturing.

Denise Green
director of the Cornell Fashion + Textile Collection

An environment of rising prices for foreign goods may give U.S. businesses cover to somewhat raise their prices, too.
As a result, the consumer price index could jump to 4.5% later in 2025, Capital Economics estimated Thursday. That’s up from 2.8% in February, and roughly double the Federal Reserve’s long-term inflation target. More

As the tariff sell-off deepens, some investors may be eager to “buy the dip,” or purchase assets at temporarily lower prices.
However, the strategy can be difficult since, of course, no one can predict future stock market moves, experts say.

Anchiy | E+ | Getty Images

As the stock market continues to fall, some investors are eager to “buy the dip,” or purchase assets at temporarily lower prices. Financial advisors, however, urge clients to stick with long-term investing plans amid the latest volatility.
U.S. stocks plunged on Thursday after President Donald Trump issued sweeping tariffs on more than 180 countries and territories. The sell-off continued Friday after China unveiled plans to impose a 34% retaliatory tariff on all goods imported from the U.S.

As of Friday afternoon, the Dow Jones Industrial Average was down more than 1,700 points following a 1,679.39 drop on Thursday. Meanwhile, the S&P 500 was off 4.8% after losing 4.84% the previous day. The tech-heavy Nasdaq Composite slid by 4.9% after plummeting 5.97% on Thursday.
More from Personal Finance:’You’re running out of time’ to claim an IRS stimulus check, tax expert saysDisability advocates sue Social Security and DOGE to stop service cutsJean Chatzky: Amid tariff turmoil, ‘you do not want to time the market’

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If you’re looking for buying opportunities while assets are down, here are some things to consider, according to financial advisors.

Timing the market is ‘impossible’

When asset values fall, there’s often chatter in online communities like Reddit about whether to “buy the dip.” Typically, investors aim to buy at a discount and expect an eventual recovery, which could lead to future gains.
While buying cheaper investments isn’t a bad idea, the strategy can be tricky to execute since, of course, no one can predict stock market moves, experts say. 

“We never recommend timing the market, mostly because it is impossible to do without simply getting lucky,” said certified financial planner Eric Roberge, CEO of Beyond Your Hammock in Boston.  
Instead, you should “stick to a thoughtful, rules-based investment strategy designed to get you through to your long-term goals,” he said. 

Keep a ‘disciplined approach’

When buying assets during a market downturn, you need a “disciplined approach,” according to CFP Jay Spector, co-chief executive officer of EverVest Financial in Scottsdale, Arizona. 
For example, some investors linger in cash while waiting for rock-bottom prices. But no one can predict the bottom of the market, experts say.
Waiting on the sidelines can be costly because the best returns can follow the biggest dips, according to research from Bank of America.Rather than trying to time the bottom, you should consider “dollar-cost averaging,” which systematically invests your money at set intervals, Spector said. The strategy can capture lower prices while reducing risk, he said. More

Fears of a global recession were ignited this week on the heels of President Donald Trump’s new tariff policy.
The market took another beating on Friday but CNBC Financial Advisor Council members say maintaining a consistent investment strategy is key.

Fg Trade | E+ | Getty Images

Meanwhile, J.P. Morgan raised its odds for a U.S. and global recession to 60%, by year end, up from 40% previously.
“Disruptive U.S. policies has been recognized as the biggest risk to the global outlook all year,” J.P. Morgan strategists said in a research note on Thursday.
Allianz’s Chief Economic Advisor Mohamed El-Erian also warned on Friday that the risk of a U.S. recession “has become uncomfortably high.”

‘There is some nervous energy’

“There is some nervous energy there,” said certified financial planner Douglas Boneparth, president of Bone Fide Wealth in New York, of the conversations he is having with his clients.

Even though stocks took a beating on Friday, “we advise them to focus on fundamentals and what they can control, which means maintaining a strong cash reserve and discipline around cash flow so that they can stay in the market and feel confident about taking advantage of buying opportunities,” said Boneparth, a member of the CNBC Financial Advisor Council.
More from Personal Finance:Tariffs are ‘lose-lose’ for U.S. jobs and industryWhy uncertainty makes the stock market go haywireAmericans are suffering from ‘sticker shock’ — how to adjust
Recession or not, maintaining a consistent cash flow and investment strategy is key, other experts say.
“The best way to manage these moments is to maximize your current and future selves is to block out noise that doesn’t apply to your plan,” said CFP Preston Cherry, founder and president of Concurrent Financial Planning in Green Bay, Wisconsin.
Letting emotions get in the way is one of “the greatest threats to life and money plans,” said Cherry, who is also a member of the CNBC Advisor Council.

When it comes to volatility tolerance, sharp drops in the market are to be expected, the advisors say.
“The stock market is unpredictable, but historically, there’s a trend in how the market recovers,” Cherry said.
“In years with market corrections and pullbacks, these are the worst days, which are followed by the best days,” he added.

In fact, the 10 best trading days by percentage gain for the S&P 500 over the past three decades all occurred during recessions, often in close proximity to the worst days, according to a Wells Fargo analysis published last year.
“Being out of the market and missing the best days and cycles after recessions significantly hurt portfolios in the long run,” Cherry said.
Boneparth said his clients also “know volatility and uncertainty is part of the game and, most importantly, know not to sell into chaos.”
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As college costs continue to climb, financial aid has not kept pace, recent reports show.
To bridge the affordability gap, more top schools are rolling out increasingly generous aid packages and even tuition-free policies.
However, “the arms race for financial aid is setting up an extreme crescendo for college admissions,” says Jamie Beaton, co-founder and CEO of Crimson Education, a college consulting firm. 

Fstop123 | E+ | Getty Images

While most people agree that a college education is worthwhile, fewer say it’s worth the high cost.
However, as college costs continue to rise, many top schools are responding by offering more generous financial aid packages to ensure affordability for qualified students, with some even covering the entire cost for low-income families. 

College tuition has surged by 5.6% a year, on average, since 1983, significantly outpacing other household expenses, a recent study by J.P. Morgan Asset Management found.
For the 2024-25 school year, tuition and fees plus room and board for a four-year private college averaged $58,600, up from $56,390 a year earlier. At four-year, in-state public colleges, it was $24,920, up from $24,080, according to the College Board.

Despite the rising costs, financial aid has not kept pace: Families now shoulder 48% of college expenses with their income and investments, up from 38% a decade ago, J.P. Morgan Asset Management also found.
The new, simplified Free Application for Federal Student Aid form, which first launched in 2023, was meant to improve access by expanding Pell Grant eligibility to provide more financial support to low- and middle-income families.
But even Pell Grants have not kept up with the rising cost of a four-year degree. Currently, the maximum Pell Grant award is $7,395, after notching a $500 increase in the 2023-34 academic year.

“Aid continues to not be enough and that’s the reality,” said Tricia Scarlata, head of education savings at J.P. Morgan Asset Management.
Taking on too much debt was also the No. 1 worry among college-bound students, according to a recent survey by The Princeton Review.
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Top colleges expand financial aid awards

This also comes amid President Donald Trump’s plans to dismantle the U.S. Department of Education and transfer the country’s $1.6 trillion student loan portfolio to the Small Business Administration.
“While the federal student loan program is in a state of flux, a lot of students are getting money directly from colleges,” said Eric Greenberg, president of Greenberg Educational Group, a New York-based consulting firm.

To bridge the affordability gap, some of the nation’s top institutions are boosting their financial aid awards to attract top students wary of sky-high college tab.
“There’s a trend of colleges with money using it as opposed to sitting on it,” Greenberg said.
Harvard University was the latest school to announce that it will be tuition free for undergraduates with family incomes of up to $200,000 beginning in the 2025-26 academic year. 
Nearly two dozen more schools have also introduced “no-loan” policies, which means student loans are eliminated altogether from their financial aid packages.

Acceptance rates hit all-time lows

Schools with the financial wherewithal to expand their no-loan aid programs are giving students a tremendous benefit, Scarlata said. “I think it’s wonderful — you still have to get into Harvard though.”
Coming out of the pandemic, highly selective colleges and universities experienced a record-breaking increase in applications, according to a report by the Common Application.
Now the acceptance rates at Ivy League schools are near rock bottom. Harvard’s acceptance rate is just under 4%, down from more than 10% two decades ago; at Princeton and Yale, it’s about 5%, down from 12% and 10%, respectively.
“The arms race for financial aid is setting up an extreme crescendo for college admissions,” said Jamie Beaton, co-founder and CEO of Crimson Education, a college consulting firm. 
More generous aid packages and tuition-free policies remove the most significant financial barrier to higher education and attract even more applicants, he said — at schools that were already among the most difficult to get into.
“There’s a massive incentive to try to gain admission to top schools,” Beaton said. “The acceptance rate has halved. And it likely will again.”
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The deadline to claim your IRS stimulus check is April 15.
Filers who never received the 2021 stimulus payment of up to $1,400 could claim the recovery rebate credit on that year’s return.
But there’s generally a three-year statute of limitations for collecting refunds.  

Douglas Sacha | Moment | Getty Images

If you still haven’t filed your 2021 tax return and never received a pandemic-era IRS stimulus check, the deadline is April 15 because there’s a three-year window to claim refunds, according to the agency.
Filers who never got the 2021 stimulus payment of up to $1,400 could claim the recovery rebate credit on that year’s return.  

“If you didn’t get the stimulus, you’re running out of time,” said Syracuse University law professor Robert Nassau, director of the school’s low-income tax clinic. 
More from Personal Finance:How to file for a free tax extension in minutes before the deadlineAmid tariff turmoil, ‘timing the market doesn’t work, expert saysYou can still lower your 2024 tax bill or boost your refundThe IRS in December announced plans to automatically send “special payments” of up to $1,400 to 1 million taxpayers who didn’t claim the 2021 recovery rebate credit on tax returns for that year.  
The agency said most payments were expected to arrive via direct deposit or paper check by late January 2025, based on the taxpayer’s 2023 tax return information.
In order to see if the IRS issued a stimulus payment, you can create an online account and view “tax records” under the “records and status” toolbar. 
“That’s the best place to look,” said Tommy Lucas, a certified financial planner and enrolled agent at Moisand Fitzgerald Tamayo in Orlando, Florida.

Your IRS online account also shows if you filed a 2021 return, Lucas said. 
If you don’t submit your 2021 filing by April 15, you could also miss other tax breaks, such as the earned income tax credit, which can trigger a refund even without taxes owed, according to the IRS.  
Currently, there are more than $1 billion in unclaimed refunds for tax year 2021, the IRS estimated in early March. That represents more than 1.1 million taxpayers and a median unpaid refund of $781. These figures don’t include applicable credits, including the recovery rebate credit.

You need ‘proof’ of filing by the deadline

While there are several free options for tax returns this season, some may not offer electronic filing for 2021 returns, Nassau warned. 
If you’re forced to mail your 2021 return, you should send the filing via certified mail for “proof” you sent it by the April 15 deadline, he said. 
“I’ve had situations where the IRS gets something after the filing [due] date, and they just reflexively say it’s too late,” Nassau said. “Spend the $5 and send it certified.” More

New Social Security Administration reforms under Department of Government Efficiency leadership are unlawful and harmful to vulnerable beneficiaries who rely on the program, a federal lawsuit alleges.
Changes including staff reductions, the elimination of certain offices and new requirements to seek in person services have made it more difficult for individuals with disabilities and older adults to access benefits, according to the claim.

A Social Security Administration (SSA) office in Washington, DC, March 26, 2025. 
Saul Loeb | Afp | Getty Images

A group of disability advocates filed a federal lawsuit against the Social Security Administration and the so-called Department of Government Efficiency on Wednesday aimed at stopping cuts to the agency’s services.
Recent changes at the Social Security Administration under DOGE — including staff reductions, the elimination of certain offices and new requirements to seek in-person services — have made it more difficult for individuals with disabilities and older adults to access benefits, the lawsuit argues.

The complaint was filed in the U.S. District Court for the District of Columbia by co-counsels Justice in Aging and Brown, Goldstein & Levy LLP.
The plaintiffs include the National Federation of the Blind, the American Association of People with Disabilities, Deaf Equality, the National Committee to Preserve Social Security and Medicare, the Massachusetts Senior Action Council and individual beneficiaries.
“The defendants’ actions are an unprecedented and unconstitutional assault on Social Security benefits, concealed beneath the hollow pretense of bureaucratic ‘reform,'” the complaint states.
In nine weeks, the new administration has “upended” the agency with “sweeping and destabilizing policy changes,” the plaintiffs claim, that have shifted agency functions to local offices while slashing telephone services.
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“The result is a systematic dismantling of SSA’s core functions, leaving millions of beneficiaries without the essential benefits they are legally entitled to,” the lawsuit complaint states.
The “mass restructuring” of the agency is unlawful and violates the Rehabilitation Act and the Administrative Procedure Act, the lawsuit argues. The changes also violate multiple constitutional provisions, including the First Amendment right to petition the government for redress of grievances, according to the plaintiffs.
With 1.1 million disability claims pending, the recent actions could also be life threatening to individuals who are dying or going bankrupt while waiting for decisions, they allege.
The Social Security Administration did not respond to CNBC’s request for comment.
“President Trump has made it clear he is committed to making the federal government more efficient,” White House spokesperson Liz Huston said in an email statement. “He has the authority to manage agency restructuring and workforce reductions, and the administration’s actions are fully compliant with the law.”

Lawsuit alleges reform is ‘administrative vandalism’

People hold signs during a protest against cuts made by U.S. President Donald Trump’s administration to the Social Security Administration, in White Plains, New York, U.S., March 22, 2025. 
Nathan Layne | Reuters

The Social Security Administration sends monthly checks to around 73 million Social Security and Supplemental Security Income beneficiaries.
DOGE, which is not an official government entity, has been tasked with cutting “waste, fraud and abuse” within the federal government. President Donald Trump issued an executive order creating DOGE on Jan. 20, the same day he was inaugurated.
Since then, the Social Security Administration has cut 7,000 employee positions and closed the Office of Civil Rights and Equal Opportunity and the Office of Transformation. The Office of Civil Rights and Equal Opportunity handled the agency’s equal employment opportunity and civil rights programs. The Office of Transformation was responsible for coordinating customer service-related initiatives like adding the ability to use digital signatures and electronic documents.
The Social Security Administration has also changed its identity proofing policies for claiming benefits and changing direct deposit information that is expected to require more individuals to visit the agency’s offices in person.
The agency has updated its policy, allowing individuals applying for Social Security Disability Insurance, Medicare, or Supplemental Security Income who cannot use a personal my Social Security account to complete their claim entirely over the telephone, starting April 14. 
The reforms amount to the dismantling of “core functions of SSA, abandoning millions of Americans to poverty and indignity,” according to the plaintiffs’ complaint.
“What the defendants frame as ‘reform’ is, in truth, administrative vandalism,” the lawsuit states.

Beneficiaries face long waits, overpayment issues

The plaintiffs include seven individuals whose experiences, including long customer service waits and, in some cases, demands to repay large sums to the Social Security Administration, are detailed in the complaint.
One plaintiff, Treva Olivero, who has been legally blind since birth, was informed in March 2024 that she had been overpaid Social Security disability insurance benefits for five or six years, prompting the agency to demand she repay more than $100,000, according to the complaint.
Olivero’s Medicaid coverage was also terminated soon after, which left her without income and health coverage. She has since been in an “ongoing struggle” to have her disability benefits reinstated, while also facing almost $80,000 in medical debt, according to the complaint.

Another plaintiff, Merry Schoch, who received Social Security disability insurance for many years, returned to work to help pay for large medical bills after she was hit by a waste management truck in 2022. She reported her income to the Social Security Administration, and the agency made no changes to her benefit payments, according to the complaint.
Two years later, Schoch stopped working and reported her unemployment to the Social Security Administration. In August 2024, the agency then terminated her benefits and informed Schoch that she owed $30,000 for the disability benefit payments she received while working full time, according to the complaint.
Last September, Schoch was informed she could reapply for benefits. However, she has since struggled to get in touch with the agency over the phone, online and in person. 
Both Olivero and Schoch are members of the National Federation of the Blind, which is also a plaintiff.
The plaintiffs want the court to reverse the Social Security Administration’s recent reforms, including staff reductions, closures of certain offices and policies requiring in-person appointments. More

Concerns about sweeping tariffs on imports are fueling a market sell-off and undermining consumer confidence.
Still there are some moves you can make to regain financial control, according to Jean Chatzky, founder and CEO of HerMoney.
But trying to time the market is almost always a losing bet, most experts say.

As President Donald Trump rolls out sweeping new tariffs on goods imported into the United States, Americans are growing increasingly pessimistic about their financial fate.
Consumers worry that the duties will cause inflation to flare up again, while investors fear that higher prices will mean lower profits and more pain for the battered stock market. 

As of Thursday morning, futures tied to the Dow Jones Industrial Average were down 1,200 points, or 2.8%. S&P 500 futures sank 3.4%, and Nasdaq-100 futures lost 4%.
But sharp drops — or sudden spikes — in the market are to be expected, according to Jean Chatzky, CEO of HerMoney.com and host of the podcast HerMoney with Jean Chatzky.
“With these volatile markets, you do not want to time the market,” she said of the old adage. “Timing the market doesn’t work — it’s time in the market.”
More from Personal Finance:Tariffs are ‘lose-lose’ for U.S. jobs and industryWhy uncertainty makes the stock market go haywireAmericans are suffering from ‘sticker shock’ — how to adjust
Trade tensions, inflation and concerns about a possible recession have undermined consumer confidence across the board, several studies show.

Still, it’s normal for most Americans to feel unnerved during heightened volatility, Chatzky said.
“There’s very little doubt that consumers are feeling nervous, maybe more nervous than we’ve felt in quite some time,” she said.
Committing to setting money aside in a high-yield savings account, whether by scaling back on dining out or rideshare expenses, will help regain some financial control, Chatzky said.
Top-yielding online savings accounts currently pay 4.4%, on average, well beyond the savings account rates at some of the largest retail banks, which average just 0.41%.
“Taking action is the best way to feel more resilient,” she said.

It’s understandable why some may be hesitant to continue investing, however, when you are investing for the long term, a down market is an opportunity for dollar-cost averaging, which helps smooth out price fluctuations in the market, Chatzky said.
This is also a good time to check your investments to make sure you are still allocated properly and rebalance as needed, so you are not taking on more risk that you are comfortable with, she added.

Timing the market is a losing bet

Talk yourself down from making any sudden financial moves, Chatzky advised.
Trying to time the market is almost always a bad idea, other financial experts also say. That’s because it’s impossible to know when good and bad days will happen.
For example, the 10 best trading days by percentage gain for the S&P 500 over the past three decades all occurred during recessions, often in close proximity to the worst days, according to a Wells Fargo analysis published last year.
And, although stocks go up and down, the S&P 500 index has an average annualized return of more than 10% over the past few decades. More

For most taxpayers, the federal tax deadline is April 15. It’s possible to push that due date to Oct. 15 by filing for an extension.
But you still must pay your taxes by the original due date to avoid racking up penalties and interest.
There are a few options to file your federal tax extension for free, experts say.

Galina Zhigalova | Moment | Getty Images

If you can’t file your taxes by the April 15 deadline, there’s a free, easy way to submit a federal tax extension online, experts say.  
Nearly 1 in 3 American admit that they procrastinate when it comes filing their taxes, according to a January survey of more than 1,000 U.S. filers from IPX1031, an investment property exchange service. In addition, about 25% do not feel prepared to file their taxes, the survey found.

As of March 21, the IRS received roughly 80 million individual returns of the 140 million expected this filing season, the agency’s latest reporting shows.
More from Personal Finance:How to spring-clean your finances. It can ‘make you feel more secure,’ advisor saysTariffs will likely raise much less money than White House projects: economistsThe federal government is phasing out paper checks. Here’s who will be affected
Many natural disaster victims have an automatic tax extension, which varies by jurisdiction. Military members serving in a combat zone also have more time to file. 
However, the federal tax deadline for the majority of taxpayers is April 15. It’s possible to push that due date to Oct. 15 by filing for an extension.
But “it’s an extension to file, not an extension to pay,” said Jo Anna Fellon, managing director at financial services firm CBIZ.

“It’s an extension to file, not an extension to pay.”

Anna Fellon

After the tax deadline, you will start incurring the failure-to-pay penalty of 0.5% of your unpaid taxes for each month or partial month that your taxes remain unpaid. The failure-to-pay penalty has a maximum charge of 25% of your unpaid taxes.
That’s cheaper than the failure-to-file penalty, which applies when you don’t submit your return by the deadline. The failure-to-file penalty is 5% of unpaid taxes monthly, also limited to 25%.
But you’ll also owe interest on your unpaid balance, which is currently 7% and accrues daily after April 15.
You can estimate your taxes owed by creating a “pro forma return” — or mock version of your filing — using as many tax forms as possible, Fellon said.

The ‘easiest way’ to file an extension

There are a few free options to file a tax extension.
For federal taxes, you can complete Form 4868 and mail it to the IRS. But it’s better to file digitally to avoid processing delays amid the agency’s shrinking workforce, experts say. Paper filing can also increase fraud risk, they say.
The “easiest way” is by choosing “extension” when making a payment for 2024, which automatically submits Form 4868, according to Tommy Lucas, a certified financial planner and enrolled agent at Moisand Fitzgerald Tamayo in Orlando, Florida.
“It takes all of five minutes,” and you can double-check the transaction via your IRS online account, he said.

IRS Direct Pay
Internal Revenue Service

Alternatively, you can file your extension for free online via IRS Free File, a public-private partnership between the IRS and several tax software companies.   
For the 2025 season, you can use IRS Free File for returns if your adjusted gross income, or AGI, was $84,000 or less in 2024. But there’s no income limit to file an extension, Lucas said.

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