File for extension or request installment agreement, which is better?

An extension showing $20,000 tax due without payment of the $20,000 can be invalidated, thus incurring late filing penalty. An extension reporting less than $20,000 due when the balance due is known to be $20,000 is fraudulent. File the return. Request the installment agreement.

"Haskel LaPort" wrote

File on time. You'll still have late payment penalties, but with an installment agreement they'll be less. So is the interest.

Generally I suggest to clients to settle up the smaller bill (usually the state) first so there's but one monster wanting to be fed. Then pay as much as you can with the payment agreement. Set the monthly amount small enough that you know you can make it given most any economic circumstances. You can always pay more at a later date, but you can never pay less......at least you shouldn't.