The 411 on Tax Extensions

The first time a client hears the suggestion or necessity to file a tax extension, they panic. With that said, if I need information from a client and they aren’t answering their phone, it seems all I need to do is say the word ‘extension’ in a voice mail message, and information magically appears.

Once a procrastinator realizes that filing for an extension gives them 6 additional months to file their tax return, the new deadline becomes much more manageable. The best part about filing an extension is that it is an extremely easy process. An extension is automatically accepted if the information pertaining to the company or individual matches the file information that the IRS has on file.

Here are some important tips in understanding Tax Extensions:

• Filing for an extension is easy
• You do not need to sign an extension form for your accountant to file one on your behalf
• You get 6 additional months to file your return – this is only an extension of time, not payment
• The most important thing to remember when you are unable to file your tax return on time, is that an extension must be filed by the original due date of the return
• The taxes are still due on the original due date and an estimate of as much or more than what you’re expecting to pay is required. If you owe additional money on the tax return in October, then there will be penalties and interest charged.
• The tax deadline for most Business returns (1065, 1120 and 1120S) is extended until 9/15, and the tax deadline for personal returns, including those with Schedule C businesses, is extended until 10/15
• Many people think that getting an extension makes them more likely to get audited. There is no evidence to indicate that this is true.
• The most common reasons that audits are performed are failure to file at all, or expenses and income that are out of line with the norm.
• If you are currently on an extension and need a preparer, we can help you!
• If you did not file the extension but have unfiled taxes, we can help you!

Call Forward Focus Accounting at 614-802-6950 and speak with one of our team members if you need help figuring out and filing your tax extension.