When you first start a business—or are considering opening one—a large mental hurdle many people have is knowing what business taxes you are required to file and when you need to file or pay them.
Filing Returns and Making Payments are Separate Tasks
Payment due dates are sometimes referred to as deposit dates and with businesses, payments are frequently due in advance of filing dates. Penalties and fines may come for both missed filing dates and missed payment dates.
Tax Return Filing
The Internal Revenue Service (IRS) manages federal taxes and local taxing authorities administer state, county, municipal (city), and other taxes. This article discusses federal taxes and provides reference links that you can go to and find out what is required in your location.
Many tax returns can now be filed online, which is referred to as e-filing. In some cases, this can result in faster refund processing when you are owed back a portion of the payments you previously made. Businesses that reach a certain income threshold are required to e-file and also to make their payments online.
When Are Taxes Due?
The due dates and intervals for payments are usually routine from year to year but they are affected by weekends and legally observed holidays. For example, Emancipation Day in the District of Columbia is April 16. When it falls on a Saturday, it is observed on April 15, which pushes the April 15 federal tax due date to April 18.
There are also exceptions for state-observed holidays and emergency orders. State holidays adjust the due dates only for specific states while emergency orders may extend the time for the whole country or specific areas that are affected by weather events or other emergencies that could cause postal delays. This allows residents more time to recover and collect their financial records.
Filing Tax Extensions
If you need more time to prepare your tax return, it's usually possible to request an extension, and you may be able to request an extension online. Depending on your type of business, different forms are used, so consult the IRS extension form page to complete the one that's needed for your type of business.
When you file for an extension, you are still required to submit your payment on the initial filing date. You may not know the exact amount of your full tax liability (the amount you owe), but you are expected to estimate and pay the amount you'll owe. When you file your return, you may have to make an additional payment or you could receive a refund if you paid too much.
Self-employed sole proprietors who file their business taxes on Schedule C with Form 1040 follow the same income tax due dates as individuals. The traditional due date for these returns is April 15 but it can be adjusted out further by the IRS, so keep an eye on the news or their website if you're cutting it close.
For partnerships, multi-entity LLCs, and S-corporations, March 15 is the standard date for filing 1065 and 1120S returns with the Schedule K-1s. For C-corporations, Form 1120 is due on April 15 of each year.
If you are self-employed, you are required to file quarterly tax payments to the IRS throughout the year. These payments are due April 15, June 15, September 15, and January 15. C-corporations have a December 15 filing date also.
For businesses with employees, the IRS requires Form 941 to be filed quarterly for federal income and other payroll taxes that the employer withheld from employee paychecks. The due dates for filing and paying them are April 30, July 31, October 31, and January 31, with adjustments made for weekends and observed holidays.
State and Local Tax Deadlines – Sales Tax, Property Tax, and More
State tax deadlines vary so check with your own state and the states you operating in to stay on top of their due dates, deposit dates, and rules. Property taxes are also governed by local authorities.
States, counties, municipalities, sovereign Native American tribal entities, and others can each also levy sales and other taxes on your business activities. They may have distinct filing and payment schedules from one another or offer you the option to e-file your taxes.
Keep Up with Due Dates
Utilize the IRS Tax Calendar, an online resource that has options to add filing and payment dates into your calendars or be sent them through email. Make preparing, filing, and paying your taxes a routine part of your business activities and address any missteps or missed dates immediately.