Colorado Business CPA, LLC

April 12, 2017

As tax season is coming to an end this year, we would like to remind you about important actions that might need to be taken by you to improve the tax side of your life.

First of all, tax returns are due by Tuesday, April 18th this year. Please keep in mind that an extension to file your tax return is not an extension to pay your tax liability. Same applies to your State’s return, (with the exception of certain states where no income tax is present.) Therefore, if you know or suspect that you owe money for taxes, then even if filing for an extension, you need to pay it by April 18th.


Second, if you are subject to estimated tax payments (if you pay your estimated taxes quarterly by sending 1040-ES forms), the first tax payments for 2017, State and Federal, are due by April 18th as well. If you are not already making estimated tax payments, we highly recommend it! Making tax liability payments throughout the year, reduces your tax liability and minimizes/removes failure to make estimated tax payments penalties.


Also, if you have payroll for your company, (either you have employees or have yourself on payroll) then Federal Payroll form 941 is due by the end of April as well as State unemployment payroll forms. (Please note that if your business is taxed as an S-corporation and you take distributions and make profit, you must have payroll for yourself too). Depending on how you submit your payroll deposits to IRS, they might be due as well (for example if you pay tax liability quarterly).


If you know someone who is not ready to file tax return, and perhaps owes but has no funds to pay tax liability at this moment, then the wise decision would be to file for an extension anyways to avoid "failure to file penalty", which is in most cases a significant amount of money. Tax payment options are also available, so you can establish a payment plan with the IRS. There is also an option to pay with your credit card online. Although, paying with a credit card should be used as a last resort since it can be costly after transaction fees have been applied.


Don’t get discouraged if you just realized that your tax liability is higher than you thought it would be though! You can hire professionals (our firm for example) to review your situation so we can find possible ways to reduce your tax liability, file an extension for you or file your tax return and even work out a payment plan with the IRS.


At our firm, we highly believe that a "Proactive Approach" to situations is very important. So start working with tax professionals like ourselves and start planning your 2017 tax situation now. Starting at the beginning of the year is always a good idea so you can plan for tax reductions in April 2017 verses December during the busy holiday season. We always recommend to work with professionals but this becomes even more crucial if you are a business owner.


Feel free to contact us with your questions, so we can help you to explore ways to reduce your tax liability and take proactive approach moving forward.


April 12, 2017

Colorado Business CPA, LLC


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