S Corp Filing Deadline: Everything You Need to Know
The S Corp filing deadline is important, as all S Corp owners will need to ensure that the S Corp information income tax return is filed each year.3 min read
2. Unemployment Tax Filing Deadline
3. Penalties for Filing Late
4. S Corp Election Deadline
The S Corp filing deadline is important, as all S Corp owners will need to ensure that the S Corp information income tax return is filed each year, along with other applicable IRS forms.
The S Corp operates as a pass-through tax entity, which means that the business’s profits and losses pass through to the shareholder (owners) of the S Corp who report it on their personal tax returns.
Income Tax Return Deadline
S Corporations must file an informational tax return by the 15th day within the third month after the company’s tax year has ended, which is generally March 15 for most corporations.
The S Corp must all fill out Form 1120s and include all of the business’s finances. Furthermore, the S Corp must attach Schedule K-1 for each shareholder. If the company fails to file by March 15, then it can receive a six-month extension by filing Form 7004 with the IRS.
Keep in mind that the shareholders of the S Corp must pay tax on the company’s income by April 15, the same deadline for all individual taxpayers. Therefore, the shareholders don’t have an extended time in which to file even though the personal tax returns will identify corporate income on their tax documents.
If the S Corp has employees, then it must withhold federal income tax from employee’s paychecks, along with Social Security and Medicare. The S Corp will also need to file Form 941 quarterly to report the total amount of withholdings. The quarterly form is due on January 31, April 30, July 31, and October 31.
Unemployment Tax Filing Deadline
If the S Corp has employees, it might also need to file Form 940 every year, which is referred to as a Federal Unemployment Tax Return.
This form is generally required if one of the following criteria is met:
- The company pays at least $1,500 in any quarter.
- The company has one or more employees working partial days in a 20-week work period.
This form reports the amount of compensation that the S Corp owes for unemployment tax. The due date for filing this form with the IRS is January 31. If the business chooses to pay the entire tax on or before the due date, then the IRS will allow the business to file it as late as February 10.
Penalties for Filing Late
If the S Corp fails to file Form 1120s by the due date (or the extended due date if it was granted), then the IRS charges the business a fee of approximately $195 per month multiplied by the number of shareholders in the business. If a partial month is past due, then the amount is generally prorated. For example, if a business with five shareholders files Form 1120s three months late, then the IRS will charge the business $585 ($195 x 3) x 5 = $2,925.
If the S Corp fails to file Form 941 by the deadline, then the IRS will charge a five percent penalty per month on the balance that is due, up to a maximum of 25 percent. Keep in mind that additional penalties are given for the late filing of Form 940.
S Corp Election Deadline
After you have formed an S Corp, you can choose to elect being taxed as an S Corp. For new businesses, you must file an S Corp election within two and a half months (75 months total) after forming.
For example, if you filed the Articles of Incorporation on August 25, then you must count two months (60 days), which would be October 25. You will then add 15 days to that date, which is November 9. If you make your election by this date, then your S Corp tax status will take effect in your first tax year.
For existing businesses, if you want to be taxed as an S Corp, you can make the election anytime from the first day of the preceding tax year up to 2.5 months (75 days) after the beginning of the applicable tax year. Before you choose to convert your business’s tax structure, you should speak to a tax professional who can assist you, as there could be some tax implications when converting your company’s tax status.
If you need help learning more about S Corp filing deadlines and what documents you must file with the IRS, you can post your legal need on UpCounsel’s marketplace. UpCounsel accepts only the top 5 percent of lawyers to its site. Lawyers on UpCounsel come from law schools such as Harvard Law and Yale Law and average 14 years of legal experience, including work with or on behalf of companies like Google, Menlo Ventures, and Airbnb.