The Last-minute Tax Extension Decision: Stop Worrying & Talk to a Tax Expert
As the April 15th tax filing deadline rapidly approaches, for most small business owners who haven’t filed there are two options: either finish your tax return, or consider an extension.
Small business owners and freelancers should consider speaking to a tax preparer regarding their situation to decide if there’s enough time to make a last-minute dash to submit your return. Otherwise, the preparer will be able to file an extension, which will give the taxpayer an additional six months of breathing room.
But there’s a catch: this only applies to the paperwork, and you are still responsible for estimating and submitting payment for your taxes. If the IRS considers your payment estimate to be incorrect, it’s possible that the IRS will assess a late penalty. The IRS charges an interest of 0.5%/month on any portion of your taxes not paid by April 15th.
According to Teaspiller.com, an online tax preparation website, most of their customers requiring an extension often complain about not being organized enough to submit their small business returns—generally overwhelmed by the amount of tax paperwork that needs to be found and organized before meeting with an accountant.
In order to get everything squared away properly, Teaspiller recommends sites like Shoeboxed to help organize business receipts. This makes it easier once tax season approaches for the customer, and also makes it easy to automatically upload all of the information directly into Teaspiller and share with your selected tax preparer.
Teaspiller’s certified experts (CPAs and IRS Enrolled Agents) can then help a Shoeboxed customer decide if an extension is needed, and whether or not you need to make a payment to the IRS–helping small business owners get the reassurance they need before making an extension decision.