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    Fiscal Year

    Every so often, someone with a moderate degree of influence recommends changing the due date of individual tax returns. Some in the tax business have suggested that a due date of June 30 would make life easier for clients and tax pros. Some tax pros feel like they could take more clients, and presumably make more money, if the date was pushed out.

    We actually saw a compromise on this when the rules for extensions were changed. Six months is now automatic; it used to be four.

    The due date of April 15 probably isn't going to change any time soon.

    But April 15 is what it is because...

    it is the 15th day of the fourth month following the close of the calendar year.

    Taxpayers with an alternate tax year have different due dates.

    Banks and other large institutions often stagger the closing dates of various billing cycles. When you have four million credit card accounts, your IT staff really doesn't want you trying to print four million statements on the 21st of every month. So you structure the accounts so that roughly one million accounts end their cycle on the 3rd, and another million end their cycle on 10th, etc. This is why it's so easy for the account holder to call up and request a different due date.

    Sooooo... for those of us whose practice is mostly, or entirely, individual returns...

    Why don't we stagger the fiscal years of our clients?

    We could just start doing a Form 3115 for three out of every four clients. Some clients might resist, but most wouldn't. Some might actually like the idea of doing their taxes in September or November. Heck, let 'em choose which quarter they want their fiscal year to end.

    In this manner, we can spread our work out through the year...

    No, this is not a serious proposal.

    But I would love to try it.

    If I actually filed a Form 3115 to change the tax year on three out of every four of my individual clients, staggering it quarter by quarter...

    I wonder how long it would take before I was rewarded with a face-to-face visit from someone at the IRS, wanting to know just what in the world I was doing?

    LMAO

    Burton M. Koss
    koss@usakoss.net
    Burton M. Koss
    koss@usakoss.net

    ____________________________________
    The map is not the territory...
    and the instruction book is not the process.

    #2
    I think with the extended due date being October 15th, there really is no need to complicate matters doing a bunch of 3115, which would result in a bunch of 481 adjustments. Why not just stagger your clients by doing half as extensions. You still need the 2 month period after the deadline to catch your breath, take CPE, and organize things before the next tax season starts.

    Comment


      #3
      Use Tax Freedom Day

      I'd be in favor of using Tax Freedom Day as the tax return due date. The calculation of the date varies by state, but it's generally considered to be Apr 30 or after. Tax Freedom Day is the day you are considered to have paid your tax bill for the year and begin actually earning income for yourself (on an annualized basis). Stated another way, prior to Tax Freedom Day every penny you've earned has either already been paid to the government or is now owed and will be paid to them by year end, assuming your income remains stable.

      Each year, we could gauge how much more or less the government is dipping into our pockets based on whether Tax Freedom Day arrives earlier or later in the year. I imagine it would influence people's voting decisions greatly.

      "The only function of economic forecasting is to make astrology look respectful" - John Kenneth Galbraith

      Comment


        #4
        As long as this isn't a serious proposal...

        JohnH suggests that "I'd be in favor of using Tax Freedom Day as the tax return due date." That's awesome, that's a statement, that's grassroots energy and it's an idea whose time has come!!

        I'm voting for JohnH for Senator. John, what state should I move to in order to vote for you?

        As for myself, I've always been attracted to the idea of having different yearends and different filing dates based on the first letter of our last names!! Like Jimmy Aaron would be a calendar year taxpayer and Katie Zeiss would have a November yearend. And along with this change, we would allow *husbands* to take their wives' last names... and picking a spouse would have a *real* impact on your tax situation. Like it doesn't now?

        Comment


          #5
          Extensions

          Originally posted by Bees Knees View Post
          I think with the extended due date being October 15th, there really is no need to complicate matters doing a bunch of 3115, which would result in a bunch of 481 adjustments. Why not just stagger your clients by doing half as extensions. You still need the 2 month period after the deadline to catch your breath, take CPE, and organize things before the next tax season starts.
          I find that the vast majority of my clients want the return done as soon as possible after they give me the last information that I need. They understand that there may be people ahead of them and they understand that I can work only about 65 hours a week. But I do not think that very many would continue to use me if I did not consistently finish returns within days of having the last information from them. The other problem is that even people who are willing to accept extensions want to pay close to exactly what they owe. It's a rare situation where calculating that is easier than actually preparing the return.

          Comment


            #6
            Learning to cry

            I'll announce my candidacy as soon as I learn to believe my own lies and weep on cue, (in response to questions on such weighty matters as how do I keep my hair so well groomed).
            "The only function of economic forecasting is to make astrology look respectful" - John Kenneth Galbraith

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