Benefits and Drawbacks to Filing an Extension – Tax Services Petoskey

Are you thinking about filing an extension? Here are a few pros and cons to consider.

Pros

• More Time: you get an extra six months to complete your return properly, (paperwork is not due until October). Whew, now you and your CPA have the time you need to find all of your deductions and supporting paperwork.

• If you are unprepared in April, waiting will make it less likely there will be errors or missing information that may trigger an audit.

• More time may also lead to identifying additional deductions, resulting in fewer taxes.

• Fast and Easy: Filing for an extension is quick and simple. It’s a one page form that you or your CPA can submit online or by mail.

• You Won’t Become a Target: Filing for an extension is not a “red flag” that will target you for an audit.

• No Late Filing Penalty: If there’s no way you can be ready on time, an extension is much better than paying a late-filing penalty.

• Typically Better Than an Amended Return: Extensions are typically quicker to process, and less likely to be audited when compared to amended returns.

Cons

• You Still Have to Pay on Time: You still have to pay 100% of your taxes by April 15th to avoid late fees and penalties. If you don’t know how much to pay and you finances are relatively stable you may be able to use previous taxes as a guideline.

• If we efile the extension, we get a confirmation.

• You Need to Have a Clue: You still have to provide some tax information when filing out the forms for an extension.

• You’ll Wait Longer For a Refund: Filing for an extension will delay your refund (if you’re owed one) until after you file your paperwork.

If you have additional questions about filing an extension or would like to schedule an appointment for a free initial consultation with a certified accountant from Harris Group at one of our three convenient locations in Traverse City, Petoskey or Suttons Bay, call 231-946-8930 or fill out the form below and someone contact you shortly. (Make sure to include the location that is most convenient for you.)