Taxpayers rejoice – after years of advocating for change, congress has finally passed legislation that modifies the deadlines of several common tax returns. The new due dates will go into effect for the 2017 Tax Filing Season (Tax year 2016). Many of our Law Firm clients will be positively affected by these changes.
The new dates have been a long time coming for taxpayers who have struggled to file accurate returns in a timely manner. Their tax advisors would often miss deadlines when forms (such as Schedules K-1,) would arrive behind schedule. The illogical flow of information not only impacted the punctuality but also the accuracy of returns. Tax advisors would often resort to using estimates because information from a flow through business was not available before the taxpayer’s income tax return was due.
With the modified dates, it is expected that owners of partnerships will be able to file their tax returns without requesting an extension. Below is a summary of the changes.
Calendar Year Businesses
For tax years that begin after December 31, 2015, returns of calendar year
- C corporations will be due April 15 rather than March 15
- partnerships will be due March 15 rather than April 15
- S corporations will continue to be due March 15
Fiscal Year Businesses
- Most C corporations returns are due on the fifteenth day of the fourth month following the end of their fiscal year
- S corporations and partnerships due on the fifteenth day of the third month
- Exceptions for C Corps with a fiscal year ending on June 30 – changes are delayed until the first taxable year beginning after December 31, 2025.
The new law also modifies the time allowed for extension of time to file for the following returns:
For calendar year taxpayers
- Form 1065: Six month period ending on September 15
- Form 1041: Five and a half month period ending on September 30
- Form 5500: Automatic three and a half month period ending on November 15
There may be initial pushback, but looking at the bigger picture the new filing and extension dates will improve the flow of information for both advisors and clients.
If you have questions about the new tax return due date changes, please contact one of our professionals today.