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Top 7 Reasons to File Your Income Tax Returns on Time

By J. Stephen Pope

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Here are seven reasons for not being late filing your income tax returns.

  1. Avoid Late Filing Penalties:


    Late filing can result in substantial and continuing
    penalties. This is in addition to any interest that is
    due.

  2. Receive Better Service from Your Accountant:


    The earlier you get your paperwork to your accountant,
    the sooner he can start preparing your tax returns. More
    importantly, there will be more opportunities to explore
    and implement tax saving strategies. On the other hand, if
    you file late, you tie your accountant's hands. For example,
    he may hesitate to retain profit in your corporation if
    such profit will be subject to substantial penalties.

  3. Avoid Criminal Charges:


    Of course, if you don't file tax returns at all for a few
    years, you may also face charges of tax evasion.

  4. Prevent Bankruptcy:


    Generally speaking, persons who don't file tax returns on
    a timely basis also lack adequate records for managing
    their business. Since they don't keep their bookkeeping
    and accounting up-to-date, they only think they know how
    they're doing and how they stand financially. This, of
    course, is a recipe for financial disaster.

  5. Enjoy Better Relations with Tax Authorities:


    Late filers also receive the unwanted attention of the
    taxation departments. Non-compliance can result in audits,
    aggressive collection action and legal proceedings. In
    addition, if you ever do have extenuating circumstances
    that might call for some leniency or extraordinary
    consideration on the part of the tax department, you are
    more likely to receive it if you have a flawless history
    of co-operation and compliance.

  6. Obtain Financing:


    You'll have difficulty obtaining financing if you can't
    provide your financial institution with current income
    information. Assessment Notices from taxation authorities
    give banks more assurance that the income claims you make
    are true. As well, if you haven't filed your current income
    tax returns, what hidden tax liabilities exist? What is the
    state of your record-keeping? How do you run your business
    without adequate financial information? Your bank may
    hesitate to loan you money or refinance under these
    circumstances.

  7. Reduce Stress and Worry:


    Many people who are late filing their taxs returns feel
    guilty about it. At the back of their minds, they worry
    about taxation authorities contacting them, audits, asset
    seizures, criminal prosecution, penalties and interest, and
    so on. Some of these worries can become magnified beyond
    what the actual situation warrants. Save yourself
    unnecessary stress by filing your income tax returns
    on time.

RESOURCE BOX:


J. Stephen Pope, President of Pope Consulting Inc.,
has been helping clients to earn maximum business profits
for over twenty-five years.

For profitable Work at Home Small Business Ideas,
visit: http://www.yenommarketinginc.com/

To learn how to reduce your income taxes, visit
visit http://www.yenommarketinginc.com/income-taxes.html

Source: http://Top7Business.com/?expert=J._Stephen_Pope

Article Submitted On: June 23, 2006