December 14, 2016
Mark Your Calendar
The acceleration of the due date has also accelerated the need for information that will be required by the tax preparer to complete the return. Don't get caught off-guard; mark your calendars accordingly and plan to start gathering the 2016 partnership tax information earlier than was done for filing 2015 partnership returns.
C Corporation Change
And, while the partnership filing date has been accelerated, the due date for filing C corporations has been moved back one month. The new due date for filing a calendar-year C corporation is now the fifteenth day of the fourth month following the tax year-end, rather than the prior filing date of the fifteenth day of the third month following the tax year-end. Under the new requirements, a calendar-year 2016 C corporation return will be initially due on April 15, 2017. Also, this change only applies to C corporations, the filing date for an S corporation has not changed and is still the fifteenth day of the third month following the tax year-end.
Exception to Date Requirement
There is an exception to the new filing date requirement for C corporations. For C corporations with a June 30 tax year-end, the new rules are effective for tax years beginning after December 31, 2025.
If you are wondering why there is a difference for June 30 tax year-end C corporations, it has to do with the accounting for the collection of tax by the IRS. There are a number of larger C corporations utilizing a June 30 tax year-end, and if the June 30 C corporations were to be included in the application of the new filing date requirements, their tax payment due at filing would have moved into a later year for U.S. government accounting purposes, which is not a desired outcome.
The new partnership and C corporation filing date requirements are effective for calendar and fiscal years beginning after December 31, 2015, unless an exception applies. Start planning now as partnership tax return filing information will be needed earlier in 2017 for filing 2016 tax returns.
Contact your Eide Bailly professional for additional information.