The October 15th Individual Income Tax-Filing Deadline is upon us and we at Nth Degree CPAs thought it appropriate to outline a better understanding of what happens on and around the deadline and also provide some tips to avoid any stress that may accompany tax-filing time for tax-filers.
As most already know, the IRS individual tax-filing deadline is April 15th (or the next business day if the 15th falls on a weekend) of each year. There is an optional 6-month extension to file that can be filed in the days up to and including April 15th in order to help those that could use a little more time to complete their filing. One thing to keep in mind though: this is an extension of time to file, not pay. Your tax bill is still due in full on April 15.
It’s important to emphasize that the failure-to-file penalty is different from the failure-to-pay penalty – taxes owed are still due by April 15th with few exceptions. The IRS also states that “a failure-to-file penalty is generally more than a failure-to-pay penalty,” which makes filing on October 15th your last chance before running into fines and penalty territory. Here is a link to Eight Facts on Filing Late and Late Payment Penalties from the IRS, if you’d like to learn more.
If you haven’t yet filed and are in need of an accountant to complete your work, you may be in a tough position. The days leading up to the deadline are filled with a variety of tasks and issues and unfortunately for you and your accountant, there is only so much time in the day – so capacity issues may impact how quickly your accountant can complete your work.
While there may be few options to filing this year’s return with minimal stress by the October 15th deadline, here are some tips to filing your 2014 return (due April 15, 2015) without feeling the pressure:
1. Talk to your tax advisor or CPA before the end of the year to get an idea of the types of documentation you’ll be required to submit to them during tax filing season. Most accounting firms will have a ‘tax organizer’ or document of some type that will outline the different pieces of information required to complete your return – ask for one and review it.
2. Ask your accountant when the earliest possible submission date of that tax documentation can take place and mark in your calendar for a time to get them everything once you’ve collected all of your documents. Your tax professional loves not being crammed up against an IRS deadline to complete your work. The limited pressure on your accountant also increases the odds of quality work being done.
3. Make a list of all of the companies/organizations that should be sending you documentation and mark your calendar to contact them in February if you haven’t received anything. Most tax-related paperwork is to be delivered by the second week of February. Build a checklist of organizations you should be receiving documents from and cross-reference to make sure you’ve received the documentation you’re owed. Contact those organizations if you haven’t received anything by mid-February to be proactive.
The best way to not worry about the October 15th deadline is to file early. With a little planning and a few small action steps, you can all but wipe out any stress around your individual tax-filing requirements.
Nth Degree CPAs is a high-value tax and accounting firm in Seattle, WA that provides integrated tax planning and preparation services as well as accounting and controller-level financial guidance for the small business community. Online at http://dev-nth-degree-cpas.pantheonsite.io