Tax season is the same time every year, but with all the whirlwind responsibilities of managing a growing business, it can be easy to turn around and realize it’s somehow already March. If you’re a startup or a small business who needs help with your taxes, that realization might come along with a sinking feeling.
Asking for a friend: if a business owner is trying to file their taxes, and discovering they’re in over their head, how late is too late to get outside help?
The answer is, later than you’d think. First, let’s talk deadlines. If you’re an S-corporation, your federal and state income tax filing is due 3/15. If you’re a C-corporation, you have slightly more breathing room with a 4/15 due date. Both of those are coming up quickly, but don’t panic. Even if you’re running behind, you still have options.
Here at Pilot, we generally require a minimum of 3 weeks for our clients’ taxes, though this timeline depends on the complexity of your tax situation. For S-corps filing by 3/15, that means the deadline to work with us was Feb 21st; for C-corps filing by 4/15, it’s right around the corner on 3/20. However, those are the deadlines to file by the original due dates. The good news is that you don’t actually need to.
The IRS allows businesses to request an automatic six-month extension for filing their income taxes. You’ll need to file the form by your normal deadline (i.e. 3/15 or 4/15), and if you expect to owe any income tax you’ll need to pay the estimated amount as well. Once you’ve gotten your request approved, however, you’ll have an extra six months to finish your full tax filing.
There’s no penalty for getting the extension, so it’s a good idea to get one if you’re worried at all about your tax filings. The extra breathing room will not only give you time to find a professional to help you, it’ll also give you time to get any preliminary work done correctly.
When you do engage an outside tax partner, here’s what they’ll need to get to work:
To go back to our opening question: how late is too late? If you’re well prepared for what a partner will need, it may only take a few weeks. If you get your extension, then you’ll have most of the year to get it right.