Installment plan may be besttax solution

first_img 160Want local news?Sign up for the Localist and stay informed Something went wrong. Please try again.subscribeCongratulations! You’re all set! NEW YORK – It’s a chilling moment that many small business owners go through at this time of the year, when they realize they don’t have enough money to pay their income taxes. They need to start working immediately on two solutions – first, how to pay their tax now, and second, how to avoid the problem in the future. Many owners in this situation understandably feel some panic when the realization sinks in that the IRS will be expecting money that they don’t have. Some might be tempted not to file their returns – but that’s not an option that anyone should consider. Not filing a return on time subjects a taxpayer to steep late-filing penalties in addition to late payment penalties and interest. They might also be thinking of filing for an extension of the filing deadline. That’s not likely to help owners with a funds shortfall; even when they get an extension, they still have to estimate their tax liability and report that amount to the government. Accountants say small business owners do have options, but they should all be considered carefully, since all carry financial consequences. For example, the one that might seem the easiest, dipping into credit cards, can also be the most expensive, considering that the interest rate on cash advances often run 20 percent or more. Another one to avoid is to divert payroll tax money to pay income taxes. Barbara Weltman, a tax attorney in Millwood, N.Y., and author of “J.K. Lasser’s Small Business Taxes,” noted that business owners can be personally liable for payroll taxes that aren’t paid. Many owners decide the solution is to raid their retirement accounts, or to tap a home equity line of credit. These are viable options, but owners need to consider the penalties that can be incurred by withdrawing money from a 401(k) or other retirement account, and the loss of investment income they’ll suffer. And diminishing the equity in their homes will add another monthly payment and can also limit their financial options for the future. Jeffrey Berdahl, a certified public accountant with Berdahl & Co. in Center Valley, Pa., suggests owners consider an installment payment agreement with the IRS. “The IRS is user friendly to work out some kind of installment plan,” he said. Generally, the IRS says you cannot be turned down for an installment agreement as long as you don’t owe more than $10,000 and you’ve timely filed your returns and paid any tax due during the previous five years. You also cannot have entered into a previous installment agreement during that time. And you must pay the amount you owe within three years. If you owe more than $10,000, you can still request an installment agreement, but Berdahl said you might need approval from an IRS district office, and chances are you’ll need to furnish the government with more financial information. To apply for an installment agreement, you need to file Form 9465, Installment Agreement Request; if you’re filing the form with your return, it must be attached to the front. You can download the form from the IRS Web site,; it includes instructions and an explanation of how the installment agreement works. You will need to pay late payment penalties and interest, and generally there is an administrative fee of up to $105. Before you sign any papers, you should do some number crunching – and maybe even get some advice from a tax adviser – to be sure that this indeed the best and most financially sensible way for you to deal with the problem. There’s a larger problem that an owner in this situation needs to deal with: how to avoid being in the same predicament in the future. The first thing an owner needs to do is figure out what went wrong, and this might best be accomplished with some professional help. Often, the problem is that an owner doesn’t have a good handle on the company’s cash flow. In that case, he or she needs to set up a better accounting system, or get someone to help them keep track of their finances. Equally common is an owner just doesn’t set aside money for taxes. Weltman suggested owners set up a tax account, which is an interest-bearing account separate from business or personal accounts, and deposit money there so it’ll be available at tax time. While a tax account can help any business, Weltman noted that people whose business is freelancing can be especially vulnerable to tax money shortfalls if they don’t set aside some of their earnings for taxes. “They take money in, collect a fee like $1,000 and look at it like it’s money to spend,” she said. “Put 25 percent of it away automatically so the money will be there.”last_img read more


first_imgROSAPENNA NOTESThe Sunday club competition on the 18th of May was won by Brian Kelly (20) with 40pts. The runner up was Pete McBride Snr (16) with 37pts bot. The gross winner was Shaun Boyce (8) with 28 gross pts.Third place was Danny Sweeney (20) with 37pts.Two’s – 22e will roll over to Sunday the 25th.The club competition on Wednesday the 14th was won by Peadar Boyce (9) with 34pts and the runner up was our overseas member William Barry (15) with 31pts bot. Two’s – Patrick McClafferty 7e, Pete McBride Jnr 7e & Pat Boyce 7e.The Rosapenna GUI Irish Mixed Foursomes team took part in the qualifying round on Sunday the 18th at Letterkenny Golf Club and finished in third position to qualify for the matchplay stages.The top four teams were Letterkenny 297.5, North-West 301, Rosapenna 305 & Strabane 309.Rosapenna will now play North-West G.C back in Letterkenny on or before Monday the 9th of June.Well done to all the players and to the team captains Bernadette North & Peter Smyth for the great result on Sunday. The Rosapenna JB Carr team played Ballybofey/S in the county final last Friday over the Old Tom Morris Links.On a blustery evening the tie was a very close encounter with the first two matches on the course ending in Rosapenna’s favour.The last two matches were won by the away team leaving the third match as the decider which ended up going to tie holes where the away pairing won on the 19th hole.Many thanks to the team captain Denis Boyce & his panel of players for their preparation & team effort on Friday past. The Rosapenna Ulster Cup team hosted Kilkeel G.C in the second round first leg over the Old Tom Morris Links last Saturday.The home team had a hugely impressive 7-0 result (41 holes up) over the team from Co Down.The return tie is due to be played this Sunday the 25th of May, best of luck to the team captain Denis Harkin and his travelling players.The Rosapenna Donegal League team hosted Portsalon at home last Thursday evening in the first round over the Old Tom Morris Links.Rosapenna had a great result claiming four  matches from a possible five (5 holes up).The return leg will take place in Portsalon on Thursday the 22nd with the first match off at 4.30pm.Best of luck to the team  captain Joe McHugh and his travelling side.The Rosapenna Minor League team travelled to Ballybofey/S last Saturday the 17th for the first leg of the first round tie.The result was 4-1 (9 holes up) to Ballybofey/S  and the return leg will take place at Rosapennaon Sunday the 8th of June.Best of luck to team captain Garvin Toye and his panel of players.Rosapenna’s Junior League team will host Strabane G.C at home this Saturday the 24th over the Old Tom Morris Links.The first match will tee off at 3.00pm.  Best of luck to team captain Seamus Connor & his panel of players.Home support is welcome.The Rosapenna Over 50’s team travel to Cruit Island for the first leg of the first round tie this Saturday the 24th.Good luck to team captain Mark Bradley & his panel of players.The Rosapenna GUI Senior Cup teamwill take part in the qualifying round over the Sandy Hills Links this Sunday the 25th.Rosapenna play alongside Portsalon with the first pair off at 8.30am.The best four cards from five will count toward the overall team total with four teams to qualify from seventeen for the matchplay stage of the competition.Rosapenna won the Ulster section in 2013 and were narrowly beaten in the All Ireland Final by Co. Sligo at Royal Tara Golf Club last September.There will be a club competition this Sunday the 25th over the Old Tom Morris Links.The weekly Wednesday club competitions are now running.Tee times must be booked in advance on 074-915-5000 for all competition days.The draw for the 2014 Michael Bonner Singles Matchplay is posted on the notice board in the Golf Pavilion and all first round ties must be played by next Monday the 26th of May.All second round ties of the Doubles Matchplay must be completed by Monday June 2nd.It is encouraged that both players make an equal effort to arrange all match-play ties as early as possible as there will be no extensions past the defined dates.It is not the responsibility of the player(s) on the top of the draw.Results posted on the respective draws may only be altered by a member of the committee.Registration for Junior Golf Lessons will take place in the Golf Pavilion on Saturday the 24th from 11.00am – 12.00pm.The 2014 Golf Fees are now due and are payable in the Pavilion Golf Shop.All second staged payments were due on May 1st as per staged payment plan.The Rosapenna Open Weekend will take place from Thursday 29th May – Monday 2nd June over both links.Thurs 29th May – Gents Singles Stableford – Old Links.Fri 30th May – Gents Singles Stroke – Old Links.Sat 31st May – Ladies & Gents 4BBB S’Ford – Sandy Hills Links.Sun 1st June – Gents Singles Stableford – Old Links.Mon 2nd June – Ladies & Gents 4BBB Stroke – Old Links.Tees times now available on 074-915-5000 or golf@rosapenna.ieThe golf club fundraising classic will take place on Saturday the 7th of June over the Sandy Hills Links.The entry fee is €100 per team of four players, open to Ladies & Gents any combination.Entries to the Pavilion Golf Shop on 074-915-5000 or Friday nine hole competitions over the Strand Nine will start on Friday the 6th of June with entry in the Pavilion Golf Shop.Any uncollected club prizes from recent presentations and open competitions are available for collection from the Pavilion Golf Shop during opening hours.GOLF NEWS: BRIAN KELLY WINS THE SUNDAY COMPETITION AT ROSAPENNA was last modified: May 20th, 2014 by John2Share this:Click to share on Facebook (Opens in new window)Click to share on Twitter (Opens in new window)Click to share on LinkedIn (Opens in new window)Click to share on Reddit (Opens in new window)Click to share on Pocket (Opens in new window)Click to share on Telegram (Opens in new window)Click to share on WhatsApp (Opens in new window)Click to share on Skype (Opens in new window)Click to print (Opens in new window)Tags:golfNoticesROSAPENNASportlast_img read more