Do you own a small business and are wondering when to file your federal income tax returns? This article will give you the information you need to keep the IRS happy.
The due dates for federal business tax returns depend on the type of business entity. Here are the possibilities, assuming that your business has a normal calendar year-end of December 31:
1. Sole Proprietorships. If you are an unincorporated business, the IRS classifies you as a sole proprietor. This means you are not a corporation or a partnership or limited liability company treated as a corporation or a partnership. Sole proprietorships file their business tax return as part of their personal income tax return on Schedule C. Other forms may also be required, such as Schedule SE (if you have profit of at least $400), Form 4562 (if you purchase business assets such as computers or other equipment), and Form 8829 (if you take the home office deduction).
Since you are filing your business return as part of your personal return, it is due on April 15. If you file an extension via Form 4868, the deadline is moved to October 15.
2. Partnerships. A partnership must also file its business income tax return by April 15. If you want to extend the due date, file Form 7004 to move the due date to September 15.
3. Corporations. C Corporations must file Form 1120 by March 15. S Corporations must file Form 1120S by March 15. Corporations are granted a six-month extension by filing Form 7004, thereby moving the due date to September 15.
4. Limited Liability Companies (LLC). An LLC is the chameleon of business entities – it can choose to be taxed like any of the above-mentioned entities. A single-owner LLC can be taxed like a sole proprietorship, a C Corporation or an S Corporation. A multi-owner LLC can be taxed like a partnership, a C Corporation or an S Corporation. However your particular LLC has chosen to be taxed will determine what business tax return form to file and the corresponding due date will apply.
Also keep in mind that filing an extension for any type of business income tax return does not grant an extension of time to pay any tax due with the return. If you have a balance due on an extended return, you will likely incur a late payment penalty. This is not a late filing penalty; that is avoided by virtue of filing the extension form on time. But you can incur a late payment penalty if the balance due is not paid by the original tax return due date. So if you anticipate having a balance due, it is best to estimate that amount and pay it by the original due date, even if you file the return by the extended due date.