There is a form available for people who want to file a business tax extension, which is a request for permission to file tax paperwork later because the necessary documentation will not be ready in time. It is important to be aware that businesses must still estimate and pay their taxes; the extension is on the paperwork, not the tax bill. For businesses in the United States, the necessary document is form 7004 from the Internal Revenue Service, and it will provide a five-month extension, pushing the due date for tax documentation to 15 September.
People may need to file a business tax extension because they are waiting on necessary paperwork and fear it will not arrive in time, or because they do not have time to complete their taxes. This can happen when paperwork arrives late, people need to fill out unfamiliar forms, and for a variety of other reasons. The extension allows people to file their tax returns late without penalties. If people cannot complete their taxes by the new deadline, they will need to talk to a tax agent about their options.
When people file a business tax extension, they must also make sure their estimated tax payments are up to date. If people think they will owe more than the amounts they have already paid, they should submit some additional money. It is better to overpay than underpay. In the event of an overpayment, when people do file their taxes, they will receive a refund. If they underpay, they will have to pay penalties in addition to making up the difference.
It is possible to file a business tax extension online or by mailing in paperwork. Tax agencies maintain copies of necessary forms on their websites. Some businesses may prefer to use third party services. These services charge a fee for submitting the paperwork and will inform the taxpayer when the government accepts the extension request. In the event tax authorities reject the application, it is usually because of an error on the form and people can resubmit.
Before filing a business tax extension, it can be a good idea to meet with an accountant to discuss whether it is necessary. The accountant can also provide an advice on handling tax liability to prevent a situation where people end up owing money and having to pay penalties. If an accountant is also a registered tax preparation agent, she can also file the extension request on behalf of the client.