Filing and paying your taxes on time is one of the most important things for a business’ accounting. In order to make sure you don’t miss a single date, we’ll go over the 2018 tax filing schedule to help business owners build a 2018 business tax calendar so they can keep up with their filing responsibilities and avoid late penalties. For the purposes of this article we have used the calendar year for our fiscal year, however if your business uses a different fiscal year, we will provide info to adjust your tax calendar accordingly at the end.
So when are 2018 business taxes due in 2019? Using the chart below and your entity type, you can identify when your deadline is to file business taxes and what it would be if you choose to use the extension. Though, you will need to take weekends and federal holidays into account.
Requirements for Pass-Through Entities (S Corps or Partnerships) by Tax Deadline
For pass-through entities, your taxes are due on the fifteenth day of the third month of your fiscal year or the fifteenth day of the ninth month if you file an extension. Pass-through entities do not pay income taxes, since their income and losses get passed on to the partners, owners, and shareholders, hence the “pass-through” moniker. Due to this, when your flow-through entity files a Form 1065 to the IRS, you must also issue Schedule K-1s to each partner or shareholder for them to report on their individual returns. So, if you plan on electing to extend your tax deadline, be sure and let all partners and shareholders know so they can do the same!
Requirements for Individuals and C Corps
Individual, including sole proprietorships, or corporation, taxes are due on the 15th day of the fourth month of your fiscal year or the 15th day of the 10th month if you file an extension. This means that if you are on calendar fiscal year, you will file your taxes or an extension on April 15, 2019, and pay any tax liability you owe, and if you ask for an extension, you will file taxes by October 15, 2019, but you will still need to pay taxes by April 15.
Make Sure You Are Ready for the Tax Code Changes
One of the most crucial things for any business’ taxes is giving yourself enough time to prepare. At the very least, every business owner should spend some hours at the end of the year to get things in order before closing one’s books. Ideally to avoid any penalties or fees, you should be working with a licensed accounting professional in order account the tax impacts of your business’ spending and earnings throughout the year.
Experts are still interpreting the Tax Cuts and Jobs Acts that went into effect on January 1, 2018, but they are already seeing some ways the new code will limit businesses’ ability to minimize their tax liability. One example that we covered in our earlier article about the tax reform is the stricter limits on deducting expenses for meals and entertainment. While it is never a good idea to start preparing taxes, this new reform makes it even more crucial to work with a tax professional in order to avoid any nasty surprises when filing.
Need Extra Time to Get Organized? The Tax Extension May Work for You
Maybe you had an exceptionally busy last couple months, personal issues taking priority, or just way more taxable activities than you expected. If you believe that there is no way that you can gather everything you and your CPA need to file on time, try extending.
C Corporations, Partnerships, and S Corporations use Form 7004 to request a 6-month extension; individuals use Form 4868. Nonprofits can request a 3-month extension using Form 8868. However, before you do anything, talk about it with your tax professional as there may be a reason they have not brought it up. Moreover, the extension is only for filing; you still have to pay your taxes by the original deadline, even if you are extending the deadline to file them.
2018 Estimated Quarterly Tax Payments for Profitable Businesses
One of the last topics we’ll touch on, if you have a profitable business, you will be responsible for paying tax on your income quarterly. These are due by the 15th day of the fourth, sixth, ninth, and twelfth months of the year. I you miss any of these estimated payments you can always pay them in full when you go file at the end of the year but you can also expect interest and penalties on these missed payments.
If you use a fiscal year instead of the calendar year for your business taxes, you’ll still file taxes in the same cadence (i.e. the 15th day of the third, fourth, or fifth month), but you may need to crunch some numbers to determine your actual tax deadlines. Follow the chart below to see when your taxes are due based on the day your fiscal year ends:
Start Planning Now to Save on 2018 Taxes
As a small business, there are many ways to save on taxes, but each takes time and strong planning ahead. Knowing your key tax deadlines is a huge step toward being compliant and avoiding late fees and penalties, but be sure to check out more of Hitech Accounting LLC’s tax resources to make sure you’re getting the most out of your business.