OVERVIEW
The S corporation has a responsibility to file an informational income tax return each year as well as a range of other IRS forms.
The Federal Emergency Management Agency (FEMA) declared certain regions in California, Georgia, and Alabama as federally declared disaster areas due to the disaster caused by recent storms. Victims of these storms have until October 16, 2023, to file various individual and business tax returns and make certain tax payments.
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Key Takeaways • S corporations are required to report tax-related financial activity by filing Form 1120S by the 15th day of the third month following the end of the tax year, typically March 15. • An S corporation can obtain an extension of time to file by filing IRS Form 7004. • An S corporation that pays wages to employees typically files IRS Form 941 for each quarter, usually by January 31, April 30, July 31, and October 31. • An S corporation with employees typically needs to file an annual Federal Unemployment Tax Return each year using Form 940 by January 31 of each year. |
S-corporation taxes
An S corporation is a “pass-through” entity, meaning that profits and losses from the corporation are reported on the tax returns of individual shareholders who are also responsible for paying the tax rather than at the corporate level. The S corporation still has a responsibility to file an informational income tax return each year as well as a range of other IRS forms that relate to various other taxes it withholds from the wages it pays to employees.
S-Corp income tax return deadline
An S corporation is required to file its annual tax return by the 15th day of the third month following the end of the tax year, generally March 15 unless this date falls on a weekend or holiday. The business is responsible for reporting all financial activity on Form 1120S and attaching a Schedule K-1 for each shareholder. These Schedule K-1s report each shareholder’s share of the business’ taxable net income so they can report it on their personal tax returns.
If the S corporation is unable to file by the deadline, it can obtain an extension of time to file by filing IRS Form 7004. The shareholders who pay tax on the S-Corp income are generally subject to the same deadlines the IRS imposes on individual taxpayers, which in most cases is April 15 every year.
TurboTax Tip: If an S corporation fails to file Form 1120S by the due date or by the extended due date, the IRS can impose a minimum penalty of $210 for each month or part of the month the return is late multiplied by the number of shareholders (tax year 2022).
Quarterly payroll tax return deadlines
If the S corporation pays wages to employees, then the company is responsible for withholding federal income tax as well as Social Security and Medicare taxes from their paychecks. This requires the S corporation to file an IRS Form 941 each quarter to report the aggregate amount it withholds and needs to send to the IRS. The form is due four times per year typically on January 31, April 30, July 31 and October 31.
Unemployment tax filing date
Having employees may also require the S corporation to file an annual Federal Unemployment Tax Return each year on Form 940. If the corporation pays wages of $1,500 or more in any calendar quarter or has at least one employee working at least part of a day in 20 or more separate weeks, it typically needs to file Form 940. The purpose of the form is to report the amount of wages the S corporation owes unemployment taxes for, which the corporation is responsible for sending to the IRS. The due date for filing Form 940 is Jan. 31 of each year. However, if the corporation pays the entire tax on time, the IRS allows it to file as late as Feb. 10.
Penalties for filing late
When S corporations fail to file Form 1120S by the due date or by the extended due date, the IRS typically imposes a minimum penalty of $210 (for 2022) for each month or part of the month the return is late multiplied by the number of shareholders. If the corporation files its Form 941 after the deadline and it has an unpaid tax balance, a 5 percent penalty may be assessed on the balance for each month or partial month the tax is late, up to a maximum of 25 percent. Similar penalties apply to filing Form 940 after the due date as well.
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