Tax Tip of the Week
March 10, 2008

Is March 17 arriving faster than you expected? If you're not ready to file your corporate tax return for calendar year 2007 - and in some cases, even if you are - you may want to request a six-month extension of time.

Here are four tips.

1. File the extension by the due date of your return. You can mail Form 7004 to the IRS or file it electronically. Either way, be sure to submit it before this year's due date of Monday, March 17 (for calendar-year corporations). Remember to send in a separate form for each corporation you own.

2. The extension is for filing only. That means you'll have to estimate and pay any tax due by March 17 in order to avoid penalty and interest charges.

3. The six-month extension is automatic. An approved extension postpones your filing due date to September 15, 2008. You don't have to sign Form 7004, and the IRS no longer sends approval notifications.

4. Check your state requirements. Some states recognize an approved federal extension of time to file; some grant extensions automatically and some require separate forms. In most cases, to avoid penalties and interest, you'll need to estimate and pay the state tax by the original due date of your return.

Besides giving you additional time to gather your records, a corporate filing extension can offer other benefits. For example, you may be able to delay making contributions to your retirement plan. Certain elections can also be extended. Give us a call if you need more information.

Questions for our Financial Expert?
E-Mail us at: finance@ClevelandSeniors.Com