Extension season continues…

by | Apr 3, 2019 | Blog | 0 comments

GP CPA recently had an opportunity to speak with Tina Orem, author and journalist at Nerd Wallet, about personal income extensions. While we don’t write as eloquently as Tina, we do speak the same language, taxes. Tina asked some important questions about extensions and what most people consistently get incorrect when it comes to personal income extensions.

While most of GP CPA’s clients do not need or request extensions at time, there are a few clients that we typically need to extend because all or some of their current year information is not available by April 15th. This reason, incomplete or non-available information, is the original and most common reason for personal income extensions. There are plenty of other reasons that cause the need for extensions, but we are going to list out the “other” reasons for personal income extensions and why they are not necessarily good reasons. The difference between a reason and an excuse is actually built into law!

  • “I think that I/we may owe taxes and I want to extend my personal taxes to provide more time for payment.” This is an excuse and creates a penalty/interest situation if monies are actually due to the IRS or state(s). If a personal income extension is filed without payment, it may be invalidated or additional penalties assessed when the return is actually filed. Personal income extensions DO NOT provide additional time to pay taxes that may be due, they offer additional time to calculate how much tax may or may not be due. Make a payment – any amount, seriously even $1 – with an extension to save yourself trouble and penalties down the road.
  • “My federal (IRS) extension covers my responsibilities with letting the state I live/work in know that I need more time.” Sure, as long as you don’t live in NC, NY or LA and a few other states. Keep in mind that if you owe state taxes, the extension needs a payment in order to be valid. Automatic state extensions are only automatic if you are expecting a refund!
  • “Extended returns are never audited…” Your personal audit risk is dependent on many factors and extensions are likely (it has never been confirmed one way or another with DATA) a very very small factor. The only thing that extensions affect in regards to audit potential, is the amount of time that your return is “under statute” for collections and possible review by the IRS.

If you have any other questions about personal or business income tax extensions, we would love to answer them. Email, carrier pigeon, or the USPS, GP CPA is available. Remember, extensions are not valid (with or without payment) unless filed by April 15th, so don’t be that person that attempts an extension on the due date and gets it wrong!

MORE ARTICLES FROM OUR BLOG

Extension season is coming… are you ready?

Many Most Nearly all of GP CPA’s clients typically do not require an extension in order to timely file their personal and corporate tax returns. This is partly due to our regular contact with our clients and the proactive approach that helps us get ahead of any issues...

Sales Tax in NC: The Impact of the Latest Decision of the Supreme Court

Sales Tax in NC: The Impact of the Latest Decision of the . has relatively stable and low sales tax rates for a mid-Atlantic state with nearly 8 million residents. The state’s general sales tax rate is 4.75% and depending on the city/county you are purchasing in, the local taxes can range from 4.8% to 8.25%.

What the Section 199A is about in new Tax Cuts and Jobs Act tax reform

Dear Landlords & Real Estate Titans: The reform added new tax code , which created a 20 percent tax deduction possibility for you if your rental property (a) has profits and (b) can qualify as a trade or business. As the law...

March 2019 Tax Update. Home-office deduction and QBI

When possible, you want to claim that your office in your home qualifies as a principal place of business because of this classification gives you the home-office deduction, andeliminates commuting from your home to your regular office.

Automation in the automotive industry

At GP CPA, we work with several clients in the automotive field, from classic restorations to rebuilding transmissions, this part of the economy has been stable for a while. One trend that we have seen while these automotive clients have grown over the past 10...

Hi GP CPA Client!

Dear GP CPA Client:At the rate the company is going, you will end up with an $18,000 tax bill at the end of year.  With about 20 weeks left in the year, we would need to move your payroll up to about $1,000 per week (its currently at $500) and put most of the paycheck...

Changes at GP CPA

This has been a busy year for all of us! Gary M Prusiensky, CPA, P.C. aka had a Google problem. We have changed the name of our firm to GP CPA, P.C. effective March 2019. “Gary M Prusiensky, CPA, P.C.” and “” had a substantial overlap on Google search...

H. Johns
H. Johns
21:58 13 Jul 19
This firm is absolutely the best that I've dealt with when it comes to CPAs and financial advice. I'd gone to another CPA in the area for help with my small business during tax time, they stopped communicating and I was left with important documentation not filed and a lot of anxiety around what to do. My appointment with Justin was set up quickly and I was in within a couple days to sit down with him. When you first meet him, you get the impression that he's incredibly intelligent and knows what he's talking about. He took the time to guide me through each and every step that I needed to take to move forward and actually ended up saving me money. I am so grateful to him for his knowledge and professionalism. Total life saver! If you're a small business owner, you should not be taking your time, money or business anywhere else but GP CPA and their crew 🙂read more
Tina Simmons
Tina Simmons
13:38 17 May 19
This team is dedicated to their clients and committed to understanding your business and sharing their knowledge to help you succeed. I love working with these folks, they take the worry and uncertainty out of accounting and taxes!read more
Bravo4 Autowerks
Bravo4 Autowerks
12:55 08 May 19
Gary and his team have been fantastic for me and my business. They respond well to all my questions, are very helpful and of course keep my financials in order. Highly recommended.read more
Queen City Newborn Care
Queen City Newborn Care
15:57 02 Apr 19
I was drowning before I met Justin. He totally transformed how I run my small business and has gotten me organized in ways I didn't even know were possible. I am so grateful for his advice and suggestions! This company is worth every penny.read more
Dennis Bloomberg
Dennis Bloomberg
16:01 26 Mar 19
Unfortunately, I found GMP when my mother passed. She had a trust set up and I had no experience with one. I received excellent advice prior to filing taxes, that allow for the transfer of assets with little tax implication. The tax process was simple for me, Justin took over once he had details and cleared up all question from filing our taxes. Thank you for a job well done!read more
Natalie Knight
Natalie Knight
15:35 21 Nov 18
Prusiensky CPA is up to date on technology. They handcraft a platform that works best for your company's accounting services. We really appreciate how hands on and quick their team is when replaying to any type of correspondence. Simply put, they care and want your company to succeed.read more
Ashlyn Lelej
Ashlyn Lelej
14:39 21 Nov 18
I highly recommend Justin at Prusiensky, CPA for all of your accounting and tax needs. I've been a client for over two years, and have been consistently impressed with their dedication to helping my business grow and be financially successful. His advice is invaluable. Thank you!read more
Bobby Nguyen
Bobby Nguyen
22:23 20 Nov 18
My partner and I started our very first small business last year. Justin has been a blessing to us. Being new at all of this, we didn’t understand much of how business taxes work. Justin explained and answer all of questions that we have. He took care of everything for us throughout the year and have made life so much easier for us. I couldn’t have asked for a better CPA. Highly recommended!read more
Next Reviews

CATEGORIES

GMP CPA is now a GP CPA, P.C.
What the Section 199A is about in new Tax Cuts and Jobs Act tax reform
How would like to contact us?