There are two reliable tactics to avoiding tax penalties: having a stable year-round accounting system and being on time. In this article, we’ll focus on the latter to help you build a simple but structured 2017-2018 calendar for both your business and personal tax returns that can help you keep up with your filing responsibilities and avoid paying more than you have to when you file your 2017 tax return.
(Still working on your 2016 tax return? You can find those dates in the 2016-2017 edition of this article.)
Fiscal Year Disclaimer:
For simplicity’s sake, we’ve based the dates listed in this article on the use of the calendar year. If December 31 is your business’s end of the year, you’re in the clear. Otherwise click here to see how an alternative fiscal year affects your business tax return due date.
When are business taxes due in 2018?
Your business’s tax return deadline is based on its entity type, whether or not you plan on filing an extension, and if there are any weekend or federal holidays in the picture.
The table below details when each type of business entity needs to file 2017 taxes in 2018 (using the calendar year)
2018 Business Tax Deadlines for 2017 Tax Filing
|Entity Type Tax Deadline||Due Date|
March 15, 2018
April 17, 2018
Original deadline for exempt organizations (Form 990)
May 15, 2018
Final deadline for partnerships and S Corporations (with extension)
September 17, 2018
Final deadline for C Corporations and individuals (with extension)
October 15, 2018
Final deadline for exempt organizations (with extension)
August 15, 2018
Typically, the tax return due date for flow-through entities is the fifteenth day of the third month of the company’s fiscal year. So the S Corporation and LLC tax return due date in 2018 will fall on March 15 (for partnerships that follow the calendar year). The extended due date for flow-through taxes will be September 17, 2018.
The tax return due date for individuals and corporations typically falls on the fifteenth day of the fourth month of the company’s fiscal year. For calendar year companies, this date tends to fall on or around Emancipation Day, which can impact the deadline. (Emancipation Day is April 16, but the government recognizes it on a Friday if that day falls on a Saturday and Monday if it falls on a Sunday.) So the corporate and individual tax return date in 2018 will fall on April 17. The extended due date for corporate and individual taxes will be October 15, 2018.
Exempt organizations, such as nonprofits and charities, must file taxes on the fifteenth day of the fifth month of the organization’s fiscal year. The 2018 due date for calendar year nonprofits is May 15. When an exempt organization files for an extension they get three months instead of six months (like other entity types, so the 2018 extended due date for exempt organization taxes is August 15, 2018.
Wondering if the tax extension is right for you or your business in 2018?
Need extra time to get your books organized? Did your business activities have major tax consequences? Feeling overwhelmed with the beginning of the year rush or just plain busy? There’s no shame in extending your tax return deadline if you genuinely think the extra time will help gather absolutely everything you and your CPA need to file your taxes.
Think of the extension as a lifeline. If you are worried you might miss your deadline or make mistakes because you’re in a rush, you should file the extension. Otherwise, you may have penalties and interest on any taxes you missed or weren’t aware that you had to pay. Which sounds better, an extra few months to cover your bases, or asking for mercy from the IRS?
To request a 6-month extension, partnerships, S Corporations, and C Corporations all use Form 7004 and individuals use Form 4868. Exempt organizations, such as nonprofits and charities, use Form 8868 to request a 3-month extension.
If you’re planning to extend your tax return deadline, be sure to consult with a tax professional and pay your tax liability on time. The extension of a time to file IS NOT an extension for paying any tax liability due (more about that here).
But First, Make Sure You Know the 2017 Estimated Quarterly Tax Payment Dates for Profitable Businesses
Ultimately, state and federal tax authorities expect all taxpayers to pay tax on income periodically throughout the year. For employees who file a W-2, these taxes are taken out of each paycheck automatically, but profitable businesses need to take the initiative to pay their portion of estimated quarterly income tax throughout each year before filing their tax return in the following year. Self-employed individuals have this responsibility as well.
So, if your business is profitable, you will be responsible for paying these installments by the fifteenth day of the fourth, sixth, ninth, and twelfth* months of the tax year (see IRS Form 1120-W). (You do have the option to wait until the end of the year, but will likely be subject to costly interest and penalties on what you owe.) If any due date falls on a Saturday, Sunday, or legal holiday, the installment is due on the next regular business day—see First Quarter Tax Estimate Deadline which is adjusted for 2017 because of Emancipation Day.
2017 Estimated Tax Payment Due Dates (Based on Calendar Year):
|Quarterly Deadline||Due Date|
First Quarter Tax Estimate Deadline
April 18, 2017
Second Quarter Tax Estimate Deadline
June 15, 2017
Third Quarter Tax Estimate Deadline
September 15, 2017
Fourth Quarter Tax Estimate Deadline (Corporations)
December 15, 2017
Fourth Quarter Tax Estimate Deadline (Individuals)
January 16, 2018
*Individuals have the option of waiting until January of the following year to pay their final quarterly tax installment, but can opt to pay on the December deadline with other businesses.
Other Things to Consider When Filing Taxes in 2018
Does your business have any foreign relationships or activities?
The stress and uncertainty of tax season are enough when your business is based strictly in the U.S., but get even more complex when you have affairs overseas. In the past, we’ve covered the various filing responsibilities companies with foreign subsidiaries, shareholders, partners, or financial accounts should be aware of, but it’s also worth stressing how important it is to meet these filing deadlines.
For example, U.S. partnerships who have shareholders that are not U.S. citizens or residents who own more than 25% are required to file Form 5472. Filing late or failing to file a correct or complete a 5472 for each qualifying foreign shareholder along with your company’s income tax return can amount to a monetary penalty of at least $10,000 per required shareholder per period. (Read more about different foreign tax filing responsibilities and their consequences in this article.)
Was your business around for just part of 2017? (Did you start or stop business this year?)
There are tax implications of starting or stopping business.
If you started your business this year, make sure you know the date you began operating as a business and consult with a tax professional to see what you can and cannot deduct. You’re not able to deduct most costs from before you started your business, but you might be able to capitalize and deduct the costs over 15 years.
If you stopped operating as a business this tax year, be sure to track the exact date your business officially ends. You should be able to account for all operational transactions before the dissolution of the business. The only cash or property that should remain in your business is the amount that you plan to distribute to investors as you liquidate and the amount you retain to pay your final taxes.
In both cases, the entity will file a short year return and is only responsible for filing taxes for the time it conducted business that year. The short year return is also applicable for some seasonal businesses.
Did your business start 2017 as an LLC but convert to a C Corp?
If you converted your business from an LLC to a C Corporation, you’ll want to work with a tax professional (and a corporate lawyer), or, at the very least, consult this article:
Once the LLC stops existing and turns into a C Corp, the IRS gives all the partners just three and a half months to file a short tax year return. At that point, they may also have to pay income taxes on any debts that transfer to the C Corp. Fail to do so, and each partner will owe $195 per month on top of his or her income tax liability.
Did you receive notice from a state or federal tax authority?
All federal or state tax notices will have a deadline by when the taxpayer must respond. Be sure to respond promptly and consult a tax professional about how you should proceed. But also, don’t freak out! If you get a notice from one of the major tax authorities—whether for a correction or an actual audit—follow these instructions and tips for working with the IRS.
Build Your Own 2017-2018 Business Tax Return Calendar
Get ahead of tax season by knowing your obligations and planning ahead. Add the relevant dates listed below to your calendar:
Add the 2017 Estimated Quarterly Payment Deadlines to your calendar:
- Q1: April 18, 2017
- Q2: June 15, 2017
- Q3: September 15, 2017
- Q4: December 15, 2017 (Corporations)
- Q4: January 16, 2018 (Individuals)
Add the 2018 filing deadlines for partnerships and S Corporations to your calendar:
- Regular: March 15, 2018
- Extended: September 17, 2018
Individual or C Corporation?
Add the 2018 filing deadlines for individuals and C Corporations to your calendar:
- Regular: April 17, 2018
- Extended: October 15, 2018
Nonprofit or charity?
Add the 2018 filing deadlines for exempt organizations to your calendar:
- Regular: May 15, 2018
- Extended: August 15, 2018
If applicable, add these to your calendar based on your records:
- Last day to pay employee bonuses that qualify toward 2017 business taxes: February 15, 2018
- #GivingTuesday 2017: November 28, 2017
- The date you start doing business
- The date you stop doing business
- Deadlines for any notices from the state/IRS
Save time and money on business taxes with the right strategy
Fortunately for small business owners, there are many ways to lower income tax liability with a little forethought and planning. To get you started on the right foot, we’ve put together The Entrepreneur’s Guide to Saving Taxes with year-round strategies you can implement to maximize your tax savings.
Did we miss anything?
Every business is unique and so are its taxes. If you have questions or concerns about your specific tax situation, submit it in the comments below or shoot us a private message. If you’re a current client, you can submit a question in your inDinero help center. If not, email us at firstname.lastname@example.org.
*Adjusting Your Tax Calendar Based on Your Fiscal Year:
If your business uses an alternative fiscal year instead of the calendar year, all it takes is some simple arithmetic to adjust the dates to fit. We’ve done (some) of the math for you in the following image from our previous blog article (How Choosing Your Fiscal Year Affects Your Business Taxes). This chart depicts the general tax due dates for any given year: