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FOR IMMEDIATE RELEASE

Many Business Owners Should Wait Until October 15 to File Taxes

For Many, April 15 is Just Another Day

August 24, 2006 -- Could a little procrastination be a good thing?  Turns out, business owners who file extensions for their tax returns are on the right track.

“While most people file their personal taxes by April 15, filing an extension can actually be advantageous to many business owners,” said Cati Piorkowski, partner with Lohman Company, PLLC, a certified public accounting firm.

Partnerships, LLC’s and individuals that filed an extension have until Oct. 16 to complete their taxes this year, since the usual deadline of Oct. 15 falls on a Sunday.  Corporations, which had an original deadline of March 15, have until Sept. 15. 

Cheryl Walsh, president and founder of WalshCOMM, a public relations and marketing firm, says she’s taking advantage of the Oct. 15 deadline for several reasons. 

“As a business owner, I have to get my company return completed before I can file my personal return.  Even though I have a bookkeeper and work closely all year with my tax advisor, it takes time to gather the information and then make sure we have taken full advantage of the deductions available to us,” said Walsh.  “Another factor for me is funding the company profit sharing plan --- I try to always fund the greatest amount possible.  Once we figure out what that amount is, I have to figure out how to fund it.  That can take some time and I have until the time I actually file the return to do it.  If that means filing on October 15, so be it.  In the end, everyone is a lot better off, including my employees.”

Piorkowski describes four reasons why business owners should wait to file their taxes:  

• The Gift of Time – Even if, by some chance, you have gathered all of your tax information by April 15, have you really had the chance to sit down and examine it?  An extension provides you (and your accountant) with that opportunity.
   
• Company retirement plans – Like Walsh, business owners who fund company retirement plans (profit sharing plans, Sep-IRAs, etc.) must do so by the due date of their tax returns.  This applies to corporations, partnerships and those who are self employed.  So if you file by the original due date, you need to deposit retirement funds by that date.  However, if you file an extension, you have another six months to come up with the money and you still get the tax deduction for the year that it’s accrued.  
   
• Avoid Audits – It may seem counterintuitive, but it’s true.  Business owners have a lower chance of being audited if they file an extension.  The Internal Revenue Service usually draws random audits from the pool of taxpayers who file by April 15, rather than Oct. 15, since the pool is larger.   
   
• Investments – Business owners who hold investments in partnerships or S-corporations must receive K-1 forms before filing their taxes.  If a partnership or S corporation files its own tax extension, investors may not receive their K-1 forms until the Oct. 15 deadline nears.   

Piorkowski emphasizes that an extension provides extra time for you to file your tax return, not pay your taxes.

“All individual taxpayers must pay their taxes by April 15 to avoid late payment penalties,” she said.  “It’s generally best to overestimate the amount you owe when submitting your payment.  If you underestimate, you could be subject to months of late payment penalties and interest.”

About Lohman Company, PLLC

Founded in 2000, Lohman Company, PLLC is a certified public accounting and business consulting firm offering professional tax, audit, accounting and consulting services to privately-owned companies in Arizona with revenues up to $200 million.  Lohman Company, PLLC specializes in serving clients in a wide range of industries including technology, manufacturing, wholesale distribution, construction, real estate and services.  Lohman Company, PLLC is committed to providing the highest level of proactive services to its clients within an atmosphere that encourages camaraderie, intellectual challenge and work-life balance for all employees. 

For More Information Contact:

Lohman Company, PLLC
Stapley Center
1630 South Stapley Drive, Suite 108
Mesa, AZ  85204

Phone:   (480) 355-1100
Fax:       (480) 355-1130
Internet: info@lohmancompany.com