Busted! Don’t Believe These Tax Myths!
As a taxpayer, you want to obey responsibilities, keep a clean record, adhere to tax laws and make the right claims on your return. This way, if you or your business ever face an audit by the IRS, you are well-prepared. The IRS strictly scrutinizes records every year, so having a chartered accountant to confirm the accuracy of your records will benefit you. To help you steer clear of these misconceptions, Conlon & Company, Certified Public Accountants, P.L.L.C has debunked some of the most widely believed myths about taxes.
Myth 1: It costs money to file an extension
This is far from the truth. Filing a tax extension is free, easy and automatic. All you have to do is submit Form 4868 electronically or on paper by the filing deadline. Not only will you extend the filing deadline, but you’ll also relieve the stress that often accompanies trying to pull everything together by tax time. More time and less stress mean you’ll be able to thoroughly review your return and ensure you’re taking advantage of all the tax benefits available to you. You’ll also avoid failure-to-file penalties.
Myth 2: Having certain expenses on your business triggers an audit
The word “audit” can surely strike fear into the heart of small business owners. The truth, however, is that the chance of the IRS auditing your small business taxes is relatively low. However, there is a list of red flags you should avoid in case you want to be in the safe zone. While this may sound simple, many returns are selected for audit due to basic mathematical mistakes! So when filling out your tax return (or checking it after your accountant has completed the form), make sure that the columns add up.
Myth 3: Making estimated payments is better than having taxes withheld
The tax withholding system was implemented to help the government raise money to finance various wars and to make it easier for the government to increase taxes without citizens protesting. Some income is not subject to withholding. This includes some income from self-employment, the sharing economy or some rental activities. Be sure to make estimated tax payments on those sources of income throughout the year.
If you’re looking to steer clear of these myths, reach out to Conlon & Company, Certified Public Accountants, P.L.L.C. As the best accountants, bookkeepers, and tax preparers in Rochester, NY, we can assist you or your business with your tax preparation and financial planning needs. Can assist you or your business with your tax preparation and financial planning needs. For a complete list of our services, please click here. If you have any questions about Conlon & Company, Certified Public Accountants, P.L.L.C, we’d love to hear from you, please contact us here.