If you are wondering whether or not you should file a small business tax extension, the quick, short answer would be no. Many small businesses find themselves consistently filing extensions year after year. This can prove to be far more expensive than paying taxes owed right out of the gate and on time. Truly filing an extension can be very costly which is why the team here at Tax Alternatives wants to take this time to offer you insight on this very questionable issue.
The Disadvantages
- An Extension Can Be Costly – First and foremost, we want our small business clients to understand the simple fact that filing a tax extension can most definitely be costly to your small business. Further, with an extension you are simply adding to your already existing stress levels and just prolonging the inevitable. The process for filing is remarkably simple and quick but, again, may not be in your best interest.
- Interest and Penalties Are Added – Many small business owners do not realize or understand that when filing an extension that does not extend the date your payment is due. The extension is specific to the filing itself, but not to the actual payment. You can most certainly request an extension to file your taxes, but you must still make any payments you believe owed on time, otherwise you face penalties. Although you may be unable to pay taxes owed at the time of filing, you need to understand that if you do not pay an estimated amount of taxes owed, should you determine you will actually owe taxes, then you will be faced with interest charges and penalties. With that said, small businesses should pay their estimated taxes owed at the time they request the tax extension.
- The Stress and Anxiety May Not Be Worth It – As a small business owner you already have so much to be focused on and worried about in the course of your every day. From creating new sales and processing payroll to putting business plans and strategies in place and taking steps to execute them, your responsibilities and worries are many. If you choose to file for an extension, you are more than likely just adding to the anxiety and stress that comes with the whole typical tax filing process. These added emotions can certainly put a huge strain on yourself and even on your business as a whole.
- One Season Will Roll Right Into Another – I think we would all agree that filing a tax extension simply delays that which is inevitable. If you delay filing your small business tax forms until the extended October deadline, by the time you they are actually filed, it will nearly be the next tax filing season all over again. This will only lead to all sorts of challenges and difficulties. From interest charges to penalties, your challenges will be many.
Sum It Up
Here at Tax Alternatives, our team of highly skilled and experienced tax specialists is steadfast in their commitment to provide only the highest quality tax filing services to all our valued clients. We are dedicated to meeting all your individual or small business needs and stand ready to serve you. If you are undecided as to whether or not to file a tax extension, reach out to one of our team members who can help you with your important decision making. Tax season can certainly be a very challenging time of year but not when you put your trust into the hands of our skilled professionals who are among some of the absolute best in the industry. For more information about our tax filing and preparation services, or to schedule a free consultation, be sure to give a shout out to our team today. Tax season is right around the corner, so don’t delay!
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