Are you a small business and own a S Corp? Are you wondering what is S Corp Tax Deadline 2021-2022? We will be discussing what is the S Corp deadline for 2021-2022 (Form 1120S) with or without extension.
S Corp is a passthrough entity and passes all of its income, losses and credits by issuing K1 to its shareholders who are individuals or Living Trusts. These individuals taxpayers need to file their taxes done by April 15th hence IRS want them to have enough time to gather their information for their personal taxes. Hence IRS has picked S Corp filing dates that are 30 days before Personal Tax Returns(1040) are due.
S Corp Tax Filing Deadline 2021-2022
As a S Corp Owner/Shareholder its important to know the S Corp Tax Return Due Date for 2021-2022.
For the Year 2021, S Corp Tax Returns are Due on March 15th, 2022. You need to either file your tax return 1120S by this date or request for an extension by filing form 7004 with the IRS.
Please note that IRS will only grant an extension if you have timely filed your previous years tax returns. For example if you didn’t file your 2020, you will not be able to get extension for 2021 taxes.
S Corp Tax Extension Deadline 2021-2022
If you have requested for an extension for 2021 taxes by timely filing form 7004 with the IRS. Then you will have till September 15th, 2022 to file your form 1120S.
If you didn’t file request for extension form 7004, you need to file your 1120S as soon as possible as the penalties for late filing will continue to accrue.
Penalty for Late Filing S Corp Tax Return
If you are unable to file your taxes by March 15th and don’t obtain extension or file after the extension time frame and file your tax by Sept 15th , the IRS will impose a minimum penalty of $205 for each month or part of the month the return is late multiplied by the number of shareholders.
IRS is very strict about enforcing these penalties. You will typically get a letter from the IRS regarding Late Filing. Make sure you respond to this letter promptly.
Example for S Corp Penalty Calculation
If you own a small business restaurant and own a S Corp with 3 shareholders and you file 3 months late the penalty will be 3 months times $205 times 3 Shareholders = $1845.
So you can see these penalties add up quickly for the S Corporation.
Penalty Abatement for S Corp Late Filing of Return
You can request a one time penalty abatement if you have always filed on time and you have a reasonable cause for late filing.
Write a detailed letter and send to IRS along with any documents you have such a Medical or hospital records or any other documents that can demonstrate that you had a reasonable cause.
In many cases IRS will grant a one time penalty abatement if you have always filed on time and your cause is reasonable. IRS has detailed information available about penalty abatement. You can learn by clicking here
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