Tax season isn’t real – really! You’ve definitely heard of tax season, aka the first few months of the year where everyone is scrambling to gather their documents, get those documents to their accountant, and pray that they manage to get everything done by the deadline. But what if we told you that the deadline isn’t even real?
Proactive Planning is #1
The best way to avoid stress around tax season is to PLAN for tax season! Make sure you meet with your accountant to get the ball rolling and avoid the tax season scramble all together. When you meet with your accountant, together you’ll estimate your income and create a tax strategy that serves you. During this meeting, your accountant will calculate how much you will owe in taxes for the year and help you decide when to pay it.
And that means at the end of the year, there’s nothing to stress about. You already know what you owe and you’ve most likely already paid it. That means that you can choose your own timeline for when to actually file. Maybe that’s during the traditional tax season… or maybe you’ll choose to extend.
Extensions Are Your Friend
Tax season runs from January through April, with the traditional deadlines for most businesses falling on March 15 and the individual tax deadline on April 15. If you miss out on the deadline and owe money to a tax agency, you run the risk of accruing late filing penalties and essentially compound the amount that you owe Uncle Sam. This is when proactive planning comes in handy – if you’ve already made your payments, this worry disappears.
But if you’re running late, there is a loop hole! You can file an extension.
Or more accurately, your accountant can file an extension on your behalf. Essentially, filing for extension gives you an extra six months to complete your returns. This means more time to gather your documents and more time to collaborate with you accountant before you file.
Extension Limitations
There’s a limit to how much an extension can do for you. While your extension allows you to file at a later date, you still have to make your payments on time. How much you’ll need to pay is based on your unique tax situation. There are two main ways we’ll determine how much you’ll need to pay for your estimated payments during your tax planning.
- Estimated based on previous year. This is the most common way to estimate what you will owe. If your current year had no significant change from your previous year, then we will provide you with vouchers for your quarterly payments without needing any other info from you.
- Tax planning. If your current year is materially different than your previous year, estimating what you owe may be a little more complex. No one wants to overpay or underpay! That’s why we recommend tax planning for any clients who can’t make estimates based on their previous year. Tax planning allows us to take a closer look at your situation and make sure you’re paying accurately.
2024 Filing Deadlines & Quarterly Payment Deadlines
| Original Deadline | Extension Deadline | |
|---|---|---|
| S-Corps, Partnerships | March 15, 2024 | Sept. 16. 2024 |
| Individual, SMLLC, C-Corp | April 15, 2024 | Oct. 15, 2024 |
| Quarter | Due Date |
|---|---|
| Q1 | April 15, 2024 |
| Q2 | June 17, 2024 |
| Q3 | Sept. 16, 2024 |
| Q4 | Jan. 15, 2025** |
Plan Ahead
When it comes to your taxes, planning ahead is always key. Whether you decide to operate within the confines of the traditional tax season or extend to give yourself a little extra time, planning is pivotal. At Encurio, we believe that timely and accurate communication is the best way to navigate your tax situation. If something changes, let us know asap. You never know what may effect your tax strategy! And if you aren’t our client yet, try setting a meeting with us to see how we can help improve your tax strategy.
