If you’ve taken the step to extend your tax filing deadline, you might feel a sense of relief. However, this is the perfect time to plan and ensure that your tax situation is as beneficial as possible. At EC Barrett, we guide you through what to do next after you’ve filed an extension.
Understand Your New Deadline
Firstly, it’s important to understand that an extension to file is not an extension to pay. If you expect to owe taxes, it’s crucial to estimate and pay those taxes by the original filing deadline to avoid potential penalties and interest. The typical extended deadline for filing your tax return is October 15. Mark this date in your calendar as the absolute last day to file.
Organize Your Documentation
Gathering and organizing your financial documents should be your next step. Collect all necessary information including W-2s, 1099s, investment income statements, and deductions such as educational expenses or charitable donations. If you’re a business owner, ensure that your books are accurate and up to date. This preparation will not only streamline the process when you do file but also maximize your potential deductions.
Consult with Your CPA
An extended deadline provides you more time to consult with your CPA. Utilize this time to discuss strategies for tax savings and perhaps adjust your financial or business plans based on current laws and economic conditions. At EC Barrett, we specialize in personalized tax advice and strategic planning tailored to your unique situation.
Review and Adjust Tax Payments
If your financial situation has changed over the past year, or if you underestimated your tax liability, now is the time to make adjustments. Reviewing your estimated tax payments ensures you’re not hit with surprises next tax season. Your CPA can help you calculate these payments accurately and avoid over or underpayment.
Plan for Next Year
Lastly, use this extension period as a proactive step towards better tax management for the upcoming year. Consider whether there are opportunities to defer income, accelerate deductions, or take advantage of tax credits. Early planning can lead to substantial tax savings.
Remember, extending your tax deadline is not just about delaying the inevitable. It’s an opportunity to enhance your financial strategy, ensure compliance, and possibly reduce your tax burden with the help of your CPA.
For further guidance, feel free to contact EC Barrett at 404-250-4570.
Our team of experienced CPAs is here to assist you with comprehensive tax and financial planning services to meet all your needs.