Many of our clients are hesitant to file an extension for their income tax returns, but there’s no need to worry – extensions are common practice. Here are 6 signs that you need one.
1. Your accounting is not finished
Don’t rush this! Your accountant or bookkeeper should not be hurrying and cutting corners! Despite it appearing to be easy, good accounting is demanding, intricate work that requires skill, knowledge of best practices and regulations, as well as attention to details.
2. You believe there are mistakes in your accounting
Have an independent party do accounting cleanup before filing. It is crucial that your accounting is correct, as those numbers flow into your business tax returns, and the business returns may flow into your individual returns. If the foundations (accounting) are incorrect, you might end up having to amend all of your returns for that year….
3. You are waiting for additional documents
Obviously, you cannot file if you do not have all the documents required for your Las Vegas tax preparer to do a good (and accurate) job with your return.
4. You can’t find a CPA you are comfortable with
Finding a good CPA in Las Vegas is important, as no one wants to deal with IRS issues. Plus, you need to have peace of mind! Don’t go with the least expensive option – knowledge and experience cost more upfront, but could literally save you thousands in case of an incorrect return or incorrect accounting, as these can lead to penalties, interest or an audit. Not to mention all that stress and wasted time!
5. Your return is VERY complex
CPAs work 16+ hour days around tax filing deadlines. If you have a complex return and would like your CPA to be well-rested while working on it, provide your documents early and be open to an extension. (This does not, of course, means your CPA will do a bad job otherwise – but they’ll appreciate the extra time).
6. You want to file on Tax Day
So do millions of other people and tax preparation firms. You might find that the electronic tax filing system is down. Or you might have internet problems. Or your in-laws might visit. Your CPA might get kidnapped. A lot of things might go wrong if you leave things to the last minute. It’s better to give yourself some extra time, just in case.
In summary:
All in all, filing for an extension is common and nothing to worry about. That being said, remember that the extension to file IS NOT AN EXTENSION TO PAY your taxes. You still have to do that by the standard deadline (we usually give our clients tax projections so they can pay on time, thus avoiding penalties and interest, while we handle their return on extension).
Need to file a tax return on extension? We’ll be happy to help! Schedule a (no-strings) tax assessment with us.