Tax preparation is inevitable. Whether an individual or a corporate, it is impertinent that taxes are filed on time, whether it is the federal tax return or state tax return. tax preparation in Tampa-FL is a process wherein the tax returns are prepared, with or without professional help that includes specialized software for tax preparation as well as online and offline tax preparation services offered by third party agencies.
Tax preparation Tampa-FL process
In the US, it is important that the taxpayer starts the tax preparation process at the earliest so that the process can be completed with no or minimum hiccups. Whether filing tax returns for the first time, or an existing taxpayer, tax preparation involves couple of steps which starts with choosing a licensed preparer (refer to the IRS directory for more information), to collating required information to fill up the required forms, to gathering your receipts for deductible expenses and gathering information related to donations and charity related funding to preparing a list of personal information related to your own as well as dependents for whom you are claiming return.
Deciding to go in for Tax extension
Tax extension revolves around extending the time required to file your tax returns. Often taxpayers request for extending the time during tax preparation because one may require more time to compile the information mentioned above. The tax extension is done by filling up Form 4868, and with the extension the taxpayer is given six months thereby making it compulsory for taxpayers to file the returns by October. The good part about taking a formal filing extension is that one can avoid all possible form of penalties that arise due to the late filing of returns. However, getting an extension certainly does not imply that you can avoid paying taxes. It is essential to know and find out more about tax extensions and related issues from your prepare, friends and family circle before filing for an extension.
Seven things those are important for a taxpayer to know and understand during tax preparation in Tampa-FL to get more time to file their tax return is:-
- To request for more time to file your tax return, you need to fill up the required Form (Form 4868) and submit the same in April itself.
- However, just by an extension, it does not imply that you are not required to pay any money to IRS in April. The truth is that it just extends the time for paperwork only - while filing for the extension, you should have a fair estimate of what the final tax amount will look like and need to pay up a specific value or full value of the estimated tax in April itself. The cheque needs to accompany the request for a tax extension. This means that your tax preparation needs to have surely started on time so that your calculations are more or less firmed up.
- Another reason for you to start your payroll tax preparation in Tampa on time is to make sure that the computation of tax is more or less accurate. This is because even with tax extension, it is important to remember that the IRS will levy interest if your estimated tax value turns out to be less than the actual value. The interest is charged on the difference. The downside is the interest compounds on a daily basis till the time the interest is paid up completely, even if you submit enough evidence and reasons for not being able to pay on time.
- Other than the above interest, there are chances that you will be charged a late payment penalty. The monetary penalty is calculated as a percentage of the outstanding tax amount till April. The ceiling on the maximum penalty is 25% of the outstanding tax. The late payment penalty is for taxpayers who have paid less than 90% of the actual tax amount by April. The IRS might let you off in case they are satisfied with your explanation for late payment, but this need to be submitted in writing with your tax returns.
- You are also liable to pay up some other forms of penalties. One is if you miss the last date of the tax extension duration. And in the event the paperwork is still not filed within 60 days of the extended date, you attract more penalties - $ 135 or the amount owed, whichever is of smaller value. This value is over and above the tax amount you owe, plus the interest on the difference amount if any and the late payment penalty.
Here again, if a written explanation is attached with the return that satisfies the IRS, then you might be saved from paying the penalty.
- One good part about the tax extension is that the citizens of Florida, and other states who are out of the country on professional front are automatically given a two months extension for tax preparation FL. People affected by natural disasters, deployed military people, are also eligible for a natural tax extension.
- Tax extensions are not necessarily requested by people who are failures or lazy. Extensions are accepted on health grounds, for families in mourning and even for families whose premises have been robbed. In genuine cases where taxpayers have evaded taxes because they had been laid off or companies have shut down, the IRS is sympathetic too.