Small Business Owners Can Avoid Tax Season Panic

By Joyce M. Rosenberg, AP Business Writer

NEW YORK (AP) — Here are some comforting words for small business owners: It's not inevitable that you'll have a tax season panic attack. Planning now will make the process of completing and filing your tax return less of an ordeal.

If you're the kind who's always rushing at the end to get your tax forms filled out, the first thing you need to do is figure out, right now, what the problems are and figure out how to fix them, even if it means hiring someone to organize your receipts and/or hiring an accountant to complete your return.

PUT YOURSELF ON A SCHEDULE

One way to make tax season easier is to set deadlines for yourself to get the different tasks done. For example, have your receipts sorted by Jan. 31. And make sure you have all your 1099s in hand (calling or e-mailing issuers if necessary) by Feb. 15.

This year, business owners who file Form 1040 and Schedule C (used by sole proprietors) or Schedule E (used by partners or S corporation owners) have three extra days to file their returns. Emancipation Day, a holiday in Washington, D.C., falls on Friday, April 15, the usual filing deadline. So all taxpayers have three more days to complete and file returns.

The March 15 filing deadline for corporations remains the same.

THINK ABOUT AN EXTENSION

If you think you're going to have trouble getting your tax return done because of business or personal reasons, plan now to get an automatic six-month extension of the filing deadline. There's no shame or harm in getting an extension. Accountants say there's no connection between getting an extension and being audited by the IRS. Many owners do it routinely because they're in partnerships and they can't complete their own returns until the partnership return has been done.

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