Business Tax Extension

Business Tax Extension: Why You May Need to File One and How It’s Done

Have you been working like crazy to get your small business off the ground? An entrepreneur’s work is never done, and sometimes things get pushed to the side. Finally, you come up for air and realize that Tax Day has snuck up on you. You could rush to finish, but then you risk losing money. As the owner of a small business, you want to find all the write-offs that you can! Instead of ending up owing more than you should, take your time and file an extension. Pressed for time and don’t think you’ll make the tax day deadline? Learn everything you need to know about filing a business tax extension with this guide.

Filing Your Extension

When it comes to S or C corporations, the deadline to file an extension is March 15th. However, if you’re an individual LLC, you can file up until April 15th. agenda-3991875_1280 The catch is that just because you file, doesn’t mean you automatically have an extension. You have to be approved, but people rarely get turned down. Generally, you only have reason to worry if you’ve had some tax issues in the past. If you are granted an extension you will have until October 15th to file. Ready to apply for your extension?

How to Do it

The type of form you will use to apply for your extension is based on what type of business you have. If you’re an S or C corporation, you will be filing with Form 7004. Individual proprietors or LLCs use Form 4868. To apply, the easiest way would be to pay a tax professional to do it for you. If you don’t have the budget for that, you can use tax filing software to submit online. It’s possible that the software won’t even charge you for the extension. Lastly, you can print out the forms online and send them through the post office. Either way, applying for a business extension is pretty simple. However, there is one unfortunate detail you need to be aware of.

What to Be Aware Of

You might be tempted to file an extension because you can’t afford to pay what you owe. Unfortunately, a tax extension only gives you more time to physically file the return. You’re still expected to pay the income taxes that you owe. The longer you procrastinate this, the more you’ll have to pay in fees and interest. If you really can’t pay, be sure to call up the IRS and explain your situation. If you dodge what you owe for too long, they can start garnishing your wages.

Don’t Wait to File Your Business Tax Extension

While you were growing your startup, April 15th quickly snuck up on you. Don’t rush to finish your taxes and end up making a mistake. Instead, file your business tax extension so you have the time to get them done accurately. Love running your business but hate having to deal with the accounting? Then contact us today to learn about our bookkeeping services!