When President Obama signs the Highway and Transportation Funding Act of 2015, the following changes to the due dates of tax returns will become effective for tax years beginning after Dec. 31, 2015:
S Corporations: The due date for Form 1120-S remains unchanged and is still due on March 15 (for calendar-year corporations) and the 15th day of the third month following the close of the fiscal year (for fiscal-year S Corporations).
Partnerships: Partnership tax returns, Form 1065, are now due March 15 (for calendar-year partnerships) and the 15th day of the third month following the close of the fiscal year (for fiscal-year partnerships). (Currently, these returns are due on April 15 for calendar-year partnerships.) The act directs the IRS to allow a maximum extension of six months until September 15 (currently October 15).
Thus, the due date of March 15 for “flow-through” tax entities (partnerships & S Corporations) will now be the same. The thinking behind this change is that since “flow-through” tax entities are taxed at the individual level, individual taxpayers will receive their K-1s in time to file their individual tax returns by the required due date. Before this change, individuals may not have received their partnership K-1 until Oct. 15, the same date their personal tax return was due. With this change, these individuals will receive their partnership K-1 30 days before their personal tax returns are due.
With the earlier due date for partnership tax returns, it is worth mentioning that failure to file a timely partnership or S Corporation tax return is subject to a $195 penalty for each month or portion of a month that the return is filed late, times the number of partners. So if a 2016 Form 1065 with 10 partners is filed on April 15, 2017, it will be 30 days late. However, there are two portions of a month that the return was filed late (March & April). Thus, the late filing penalty is computed as $195 x 2 months X 10 partners or $3,900.
C Corporations: Corporate tax returns, Form 1120, are now due April 15 (for calendar-year partnerships) and the 15th day of the fourth month following the close of the fiscal year (for fiscal-year C Corporations). Currently, these returns are due on March 15 for calendar-year corporations. Corporations will be allowed a six-month extension, except that calendar-year corporations would get a five-month extension until 2026 and corporations with a June 30 year end would get a seven-month extension until 2026.
FinCEN Form 114: FinCEN Form 114, Report of Foreign Bank and Financial Accounts (FBAR), the due date is changed from June 30 to April 15, and for the first time taxpayers will be allowed a six-month extension. FinCEN Form 114 applies to taxpayers who hold at least $10,000 in a foreign account (bank, investment, cash value in an insurance policy, pension plan, etc.) on any day during the calendar year.
Other Due Date Changes: The act directs the IRS to modify its regulations to allow a maximum extension of 5 1/2 months on Form 1041, U.S. Income Tax Return for Estates and Trusts; 3 1/2 months on Form 5500, Annual Return/Report of Employee Benefit Plan; and six months on Form 990, Return of Organization Exempt From Income Tax, Form 4720, Return of Certain Excise Taxes Under Chapters 41 and 42 of the Internal Revenue Code, Form 5227, Split-Interest Trust Information Return, Form 6069, Return of Excise Tax on Excess Contributions to Black Lung Benefit Trust Under Section 4953 and Computation of Section 192 Deduction, Form 8870, Information Return for Transfers Associated With Certain Personal Benefit Contracts, and Form 3520-A, Annual Information Return of a Foreign Trust With a U.S. Owner.
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