Get an Automatic Extension to File Your Taxes!

Tax Season is over for us!  The office will be closing at noon today and we’ll be back on Thursday, April 17th.

Our last phone call from a potential new client asking for tax preparation help came yesterday at 10:25 am. At least we hope that was the last call!

We couldn’t help the caller file the taxes by April 15th.  They’d waited too long to pick a tax preparer and get their information to us.

Haven’t Filed — Here’s How to Avoid a Hefty Penalty

Yesterday, and for the past few days, we have been telling prospective clients to submit an extension request form to the IRS.  That will give them until October 15th to formally file. We’ve also set up callers with appointments in our office later this week so they can give us their tax information.

But, whether you plan on getting professional tax help or do it yourself, file the automatic extension request today.

Download the Form 4868 from the IRS website, print it, fill it out, and mail it so it gets postmarked April 15th!

And, if you have a complex return we can help you with, please contact us Thursday after 8:30 am at 415.433.4500.

The IRS grants an automatic extension to file your tax forms, but the law requires that you pay what you owe by today.  So, if you think you may have to pay the IRS this year, enclose a check to cover your estimated shortfall with the extension form.

New Year’s Special: Pay and Save!

San Francisco Charles Sterck on Lowering TaxesIf you owe your CPA, pay your account balance this week and save on your taxes!

Well, it’s not just your accountant’s bill.  For many businesses and individuals it makes sense to pay as many bills as you can before the new year.

Most small businesses are on a cash basis. That means that you have to pay an invoice in order to count it as an expense against the business’ income.  And, most small businesses use the calendar year to record income and expenses.

Usually it makes sense to pay as many bills as you can this year so that the net income you report to the government is as low as possible.  A lower income results in lower taxes.

The same rule is also usually true for individuals.  If you can, you should pay property taxes, January’s home mortgage, and accelerate other tax-deductible payments into 2011.  The more deductions you accumulate in 2011, the less you will owe in April, 2012.

On the other hand, if you expect for you or your business to earn a lot more in 2012 than you did in 2011, you might want to push your tax-deductible expenses into 2012.  (You still should pay your CPA now, of course.)

The rules are somewhat complex, and you should contact a tax professional to see what the best course of action is for you. Everyone, though, should look at their tax situation THIS WEEK.

You need to act before New Year’s if you want most of the available deductions. Most people have until April 17, 2012 to fund their 2011 IRA retirement contribution, but all other options run out at midnight December 31st.

So, sit down.  Go over your business and personal bills. Make a pile of those invoices that have tax consequences, and decide whether you want to pay them now or next year.  Make your electronic bill payment, charge your credit card, or write the check and mail it.  Today!

For information on last-minute planning for your specific situation, please phone Sterck Kulik O’Neill at 415.433.4500.