Saturday, April 11, 2009


Before I drop my tax return in the mail I have a question. I heard you speak last year at the IBS show in New York City, and if I remember correctly you said that it is a good idea to extend filing the return until October 15th. Why should I wait?


T.R., extending a return depends on your situation. We extend 100's of returns every year. I always extend my return. Don't forget, this is an extension of time to file, not an extension of time to pay. We don't extend returns just to give us more time to finish the returns. We have most of the returns ready to go, but rather than send to the IRS we hold them until the extended due date.There are a few reasons that we like extending the returns:
  • First, when we file your tax return, we have in effect closed out any options we have for the year. This includes items we have made elections on or how to depreciate equipment, taking fast depreciation, capitalization of certain items, etc. Waiting until September/October 15, 2009 gives us a chance to determine whether or not the elections we make at this time are correct.
  • The second reason is, supposedly there is less chance of being audited if you do not file your tax return immediately. According to some experts, in order to start the audit process, most 2008 tax returns are chosen for audit by September 1, 2009. Since your return will not be filed, you will not be part of the “audit lottery.”
  • We extend your returns because if an earlier year’s return should happen to be audited before we file the extended return, the Internal Revenue Service will not have the current return to look at.

Larry Kopsa CPA