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The Internal Revenue Service (“IRS”) has flipped business tax filing deadlines on their heads. These changes in the due dates for several types of business tax returns are intended to give accountants and tax preparers a little extra breathing room. But the changes also may mean confusion for many business owners.
Effective this year, businesses taxed as a partnership, including most limited liability companies (LLCs), will have their filing deadlines moved to March 15th to coincide with the deadline for filing S-corporation tax returns. If the partnership isn’t on a calendar year basis, the return is due on the 15th day of the third month following the end of the tax year.
Meanwhile, corporations taxed under Schedule C of the Internal Revenue Code will be due on April 15th (or the 15th day of the fourth month following the end of the tax year) to coincide with the deadline for filing personal tax returns.
Under the previous scheme, S-Corporations and C-corporations had to file their returns by March 15th, while partnerships and individuals had to file by April 15th. Thus, partnerships and C-corporations are essentially switching places on the calendar.
These changes make sense in the context of Schedule K-1 forms that are generated by “pass-through” entities such as most LLCs, S-corporations, and partnerships. Entities that generate Schedules K-1 will be due before the C-corporation and personal tax returns that require that K-1 information. That means fewer amended tax returns, and hopefully a smoother tax season for everyone.