Not Done Yet!
- BR Accounting And Tax Service
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I hope you have managed to stay safe and well! We focus on resolving tax issues in Prince William County and throughout the lower Northern Virginia area.
Now that the initial leg of the tax season race has ended, everyone can breath a much needed sigh of relief. If you filed an extension, you are now on the clock for the 10/15 deadline for filing individual/joint or C Corporation returns (9/15 is the deadline for all of the pass through entity business extension filers). Remember to use the trick of paying any tax due, plus a little extra, if you filed an extension and you’re on some sort of payment plan with the IRS (whether it be OIC or streamlined plan). Traditionally, this has prevented the federal government from terminating your agreement and possibly having to start your resolution process completely over. Which means more fees, interest, and penalties. Nobody wants that
Nonfilers. This is your opportunity to get back into compliance. Taxpayers now have a number of options for resolving tax debt. Don’t wait until the IRS shows up at your doorstep (which apparently they’re going to resume doing sometime in June of the current year, and expect to ramp back up to pre Covid collection mode by the end of October (December at the latest). Installment Agreements, OICs, and FTAs are a few different types of resolutions, that can be used to reduce or eliminate the total amount of your obligation.
Remember that filing for extension of time to file does not grant the taxpayer more time to pay their obligation. An extension of time to pay can only be granted by the IRS on a case by case basis. Its best to make plans now to finalize your tax returns as soon as possible, thereby mitigating your tax obligation. Also, if you neglected to file for an extension, you especially want to have your taxes prepared and filed as quickly as possible. Reason being the failure to file penalty for individual/joint returns is 5% per month, for a maximum of 25% of the total owed! That’s massive! Have a pass through entity, like an S Corporation or Partnership, the failure to file penalty is $210 per month (oh yeah, partial months count in all of this. Meaning from 4/18 to 4/30 counts as one month)
If ever you’re feeling overwhelmed or you’d rather be doing something else with your time, just remember we’re here to help you with all of your tax preparation, resolution/representation needs. Now and in the future. Don’t put off addressing your tax situation. Feel free to contact us with any questions you may have in approaching your specific tax scenario.