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With tax season right around the corner, or if you are a corporation, the corner you just passed, avoiding tax penalties should be in your mind. Did you know that penalties and interest paid for not filing and paying your taxes on time is NOT a deductible expense? All the more reason to file and pay on time!

This year corporate returns and tax payments were due on March 15th. Because the 15th falls on a Friday, personal and partnership taxes and payments are due on April 18th. If you fail to file your return and pay the taxes you owe, you will be assessed penalties and interest from both the IRS and the Franchise Tax Board. For example, failing to file your federal return on time will cost you 5% of the tax amount due for each month it is late, with a maximum 25% penalty. Paying your taxes late also will come with an additional 5% penalty per month, up to 25%.

Penalties also will be assessed for not paying your estimated taxes on time, depositing your employee tax withholdings late, or paying your sales tax deposit after their due date.

If the reason you have been avoiding thinking about your taxes is because your records are not in order or you don’t even know where to start, give us a call. We can help you get your documents together to send to your accountant so that you can avoid those penalties!