Contractors and construction business owners are no stranger to tight deadlines,
unexpected project delays, and navigating complex regulatory requirements. When it
comes to taxes, the pressure to file on time can feel just as overwhelming. However,
filing an extension can provide you with the flexibility you need to manage your
business’s tax obligations more effectively. There are many reasons why filing an
extension could be the best decision for your construction or contracting business.
You may need to reconcile various income sources, track materials and labor costs, and
account for subcontractor payments. Filing an extension allows you extra time to collect
all the necessary documents and ensure your financial statements are accurate.
Without this extension, you might be forced to rush through this process, potentially
leading to costly mistakes or missing deductions.
Construction businesses often have unique expenses, such as equipment purchases,
subcontractor costs, and project-related travel. By filing an extension, you give yourself
the opportunity to thoroughly review your financials and ensure you’ve captured all
possible deductions. Whether it’s taking advantage of depreciation on equipment or
correctly allocating expenses to the right projects, additional time to evaluate your tax
situation can lead to significant savings.
If you miss the tax filing deadline, the IRS can impose penalties for late filing and late
payment. While filing an extension doesn’t provide additional time to pay your taxes, it
does give you more time to submit your tax return. This could be beneficial if you need
more time to prepare your finances or if you’re waiting for final documents that are
crucial to completing your filing.
If you anticipate owing taxes, it’s important to make an estimated payment to avoid any
penalties or interest.
Construction businesses can face challenges in complying with tax laws due to the
intricacies of the industry. For example, contractors may need to navigate tax credits for
energy-efficient construction, or specific state and local tax obligations. Filing an
extension gives you time to consult with tax professionals to ensure that your tax filings
are compliant with all relevant regulations and that you are taking full advantage of the
tax breaks available to you.
Filing for an extension is a relatively straightforward process, especially if you work with
an accounting firm experienced in the construction and contractor industries. They may
be able to help you file the necessary paperwork with the IRS, so you don’t have to
worry about missing deadlines or filling out complex forms. The extension will
automatically give you an additional six months to file your return.
Filing an extension provides several advantages for construction and contractor
businesses, from ensuring accuracy in tax filing to maximizing deductions and avoiding
penalties. With the unique challenges that come with the construction industry, it’s
crucial to take your time in preparing your tax return and consulting with a professional
who understands your business needs.
At adding technology, we know you want to focus on what you do best as a contractor. In order to do that, you need a proactive back office crew who has financial expertise in your industry.
The problem is that managing and understanding key financial compliance details for your business is a distraction when you want to spend your time focused on building your business (and our collective future).
We understand that there is an art to what contractors do, and financial worries can disrupt the creative process and quality of work. We know that many contractors struggle with messy books, lack of realtime financial visibility, and the stress of compliance issues. These challenges can lead to frustration, overwhelm, and fear that distracts from their core business.
That's where we come in. We're not just accountants; we're part of your crew. We renovate your books, implement cutting-edge technology, and provide you with the real-time job costing and financial insights you need to make informed decisions. Our services are designed to give you peace of mind, allowing you to focus on what you do best - creating and building.
Here’s how we do it:
Schedule a conversation today, and in the meantime, download the Contractor’s Blueprint for Financial Success: A Step by-Step Guide to Maximizing Profits in Construction.” So you can stop worrying about accounting, technology, and compliance details and be free to hammer out success in the field.