April 15th is just a few days away and some of you may be wondering what to do because you haven't filed your tax return yet. You may be shocked (I always am!) by the number of phone calls my office gets from the public on April 15th looking for help with filing an extension. And many of those callers are equally shocked when my office answers the phone and can help them even on such short notice.
Here are a few last minute filing tips:
#1 Don't rush through your tax return just to meet the deadline. Tax returns that are prepared in a hurry are more likely to have mistakes. The tax return deadline has a way of sneaking up and putting many in a frenzy to try and meet the deadline.
It is very likely that as you are rushing to get your information to your CPA, you forget to include key information. I've even seen taxpayers forget to share that they started a new business!
While it may be tempting to just get it done, you definitely want to make sure you give your CPA time to analyze your tax return. My team and I are often able to find tax savings opportunities during the tax return preparation process, and come up with tax savings ideas for the new year, but you don't give your CPA an opportunity to do this when you file at the last minute.
#2 File an extension before the deadline. In order to give you and your CPA the time to prepare your return so you pay the least amount of tax legally, file an extension. An individual extension extends the due date of your return until October 15th. When you file an extension, it doesn't mean you are off the hook until October rolls around! Get your tax return filed shortly after the April 15th deadline to be sure to avoid the rush of the October 15th deadline, when no more extensions are available!
Be sure to check with the state(s) to make sure they accept the federal extension. Most do, however, some require a separate state extension.
#3 Focus on paying your taxes by the deadline. An extension extends the time to file your tax return. It does NOT extend the due date of your taxes. So put your focus on determining how much you should pay with your federal and extensions. Getting this number right will reduce any penalties and interest that could be assessed
April 15th Reminder: Many individuals and businesses have estimated tax payments due April 15th, so even if you have filed your tax return, make sure you have also taken care of your estimated tax payment.
The best potential to create massive tax savings comes from planning your taxes not only throughout the year, but years in advance.
This doesn't mean you have to treat your tax planning like a part-time job (although I've seen tax savings that yield more than a part-time job!). It simply means take a few hours now to create a tax strategy that is specific to you, then integrate your strategy into your daily routine and take a few hours a month to keep it on track.
I think most people dread tax planning because it's something they have found to be boring and confusing (and sometimes painful) in the past. Traditional tax planning can be all of this!
This is why I've made it my mission to make taxes more understandable. I've just recently taken the hundreds of strategies I use with clients and broken them down into 5 secrets that cover the scope of how to create massive tax savings.
5 Secrets to Massive Tax Savings
Secret #1 Rules the IRS Won't Tell You
Secret #2 Creating Permanent Tax Savings
Secret #3 Forming Your Personal Tax Strategy
Secret #4 Tax Saving Entity Structures
Secret #5 Reducing Your IRS Audit Risk
I'm so excited to share this information!
I'm going to share more about each of these secrets over the next few weeks, but before getting into those details, this week I want to share the common theme behind each of the secrets.
Behind Every Secret is... Knowledge! Now, I'm not referring to the type of knowledge that will have you quoting Internal Revenue Code sections - that falls into the category of boring and confusing. The knowledge I'm referring to is the type of knowledge that makes you aware of what creates massive tax savings so you begin to see your daily routine a little differently.
Here is an example most people can relate to:
Have you ever noticed that right after you buy a new car, you see that same car everywhere and you don't remember ever seeing that many before? The reality is the cars have always been there, it just takes awareness to see them. Once you become aware of the car, you see it everywhere.
The same is true for tax savings! The opportunities are there, it's just a matter of being aware of them.
Tom Wheelwright has sinced written about articles on various topics from Legal Matters, Finances and Management. April 15th is just a few days away and some of you may be wondering what to do because you haven't filed your tax return yet.