Corporations only have only till March 15th 2016 to file their corporate tax returns! The penalties for late filing can get out of hand very quickly.
The 1120s penalty for late filing is $195 for each month or part of a month, up to 12 months that the return is late or missing information. That’s right; even if you file timely you may still be penalized if your 1120s return doesn’t have all the information required by the IRS.
The $195 penalty is per shareholder! So filing your 1120s return late could get very expensive very quickly. Example a company that files late who only has 4 shareholders will have a minimum penalty of $780.00!
Another reason to make sure that you file your 1120s and 1065 partnership returns on time is so that you can get your shareholder’s and Members their K-1s on time.
Failure to timely furnish a shareholder their K-1 from the 1120s can result in a penalty of $260 per shareholder! If it is shown that the correct information is intentionally disregarded the penalty increases to $520 or 10% of the aggregate amount of items required to be reported. https://www.irs.gov/instructions/i1120s/ch01.html#d0e557
1120 corporation late filing fee is $135 minimum.
A corporation that does not file its tax return by the due date, including extensions, may be penalized 5% of the unpaid tax for each month or part of a month the return is late, up to a maximum of 25% of the unpaid tax. The minimum penalty for a return that is over 60 days late is the smaller of the tax due or $135. The penalty will not be imposed if the corporation can show that the failure to file on time was due to reasonable cause. There are also further penalties for an 1120 corp for not paying their corporate tax on time.
1065 Partnership returns also have a $195 penalty.
Again there is a penalty for not including all the correct information on apartner’s K-1.The penalty for failing to furnish a partner his/her K-1 is $260. If the failure to furnish a member his/her Schedule K-1 when due with the correct information, is intentionally disregarded, the failure to furnish penalty is increased to $520 per partner K-1. Example; if a Partnership intentionally withholds the company’s partners K1s and there are 5 other partners, the penalty would be $2,600 minimum. The maximum penalty is $3,178,500 for all such failures during a calendar year.
There is much more to discuss about this subject but this brief overview should be enough to inform a company how important it is to file their corporate taxes on time!
If you have questions about filing your 1120, 1120s or 1065 tax returns call IslandGrove Consulting at 912-882-8244 or email us at
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Author: Johnathan Summers, 13 years in corporate accounting and tax preparation.
Citations, some content paraphrased from irs.gov Each IRS web address linked after the paragraph in which the information was referenced. This is not legal advice or a consultation. You should consult a tax professional before you make any business decisions as a result from reading this article. There is no opinion expressed in this article. Only facts as given by the internal revenue service have been given in this article as a reminder of late filing penalties. And if you are still reading this, I hope you have a great day. If you owe IslandGrove money please pay your bill. I have three new cars I want to buy and people like you are keeping me from my overindulgence by not paying your bill. Oh and if you are that brunette who winked at me in the black 350Z as you drove past, email me. Everyone else, take care. Be strong and fearless. Chow.