For all Americans, the regular tax filing deadline is April 15th of each year. For people who are dealing with extenuating circumstances and can’t meet that deadline, the IRS allows for the requesting of a final extension date of October 15th. For tax filers who are currently faced with the final extension deadline, it’s time to for you to gather your tax information and start the tax filing process.

The Need For Tax Planning

For most Americans, the tax preparation process is both cumbersome and complicated. The idiosyncrasies of the tax code often leave individuals with more questions than answers. That’s reason enough for you to consider having a tax plan in place every year. A viable tax plan should include everything from calculating your potential tax liability over the year all the way through how and where you are going to get your tax returns prepared.

Calculating your potential tax liability at the beginning of the year is important in order to allow you sufficient time to properly set your with-holdings or plan for your quarterly estimated tax payments. If you can effectively achieve this task, you will minimize the probability of owing a significant amount in taxes at the end of the year. In a perfect world, you want your tax liability on December 31 to be as close to zero as possible.

Avoiding Penalties

Due to the possibility of exorbitant penalties, it is important that you meet the IRS’ tax deadlines without fail. If you are operating under the final October 15th deadline, you should be aware that missing the deadline will expose you to a penalty of 5% per month (fraction of a month counts as a full month) of the total total amount owed with a maximum of 25%. Depending on your outstanding liability that number could be substantial. Also, filing on time without payment exposes you to a penalty of .05% each month (beginning with original April 15 deadline) of the amount outstanding until paid, again up to a maximum of 25%.

If you are feeling overwhelmed by the oncoming October 15 deadline, Pogosian and Company, CPA is ready and willing to help you with the tax preparation process. With our expertise, you can rest easy knowing your returns will be filed accurately and in a timely manner.

For a Free Consultation, please feel free to contact us at (818) 396-0705 to Schedule an Appointment.