Yesterday, we talked about individual income tax filing.  Today, we will discuss the forms businesses, trusts, estates, and partnerships must file.

First, I should say that if you are a sole practitioner (in business for yourself), then you still file Form 1040 (as we discussed yesterday), but need to complete Schedule C, which covers the business income and expenses for those self-employed folks.  (You may also need to file Schedule SE (for self-employment taxes), Form 4562 (Depreciation on capital items like machinery and office equipment) and/or  Form 8829 (expenses for using your home in a business).

If you are in business with someone else, then you are a partnership.  You should be registered with your local community and/or your state, and have a Federal Employer Identification Number (FEIN).  You file Form 1065, Partnership tax return, for your business in this instance.   Each partner also receives a K-1 form, that details the profits, losses, and non-deductible items.  (Partnerships appropriate profits and losses according to the share of ownership; LLC entities can allocate profits and losses as they elect each year.) The due date for filing this form is the same as it would be for individuals (if the partnership operates on a calendar year)- 15 April; but the form is always due to be filed 3.5 months after the end of its fiscal year.

If you have incorporated your business (which means you are not a partnership) or formed an LLC AND notified the IRS you wish to operate as a corporation (Form 8832), then you file different forms.  (LLC’s with only one stockholder- you- are considered “Disregarded Entities” and file individual tax returns with the Schedule C, as described above.)  If you have less than 100 stockholders and wish all profits and losses to accrue directly to the stockholders of the corporation, then you should have filed Form 2553 much, much earlier in the calendar year (like 1 January or the day you incorporated) or in a previous year.  These “S” corporations (it used to connote “small business corporations”) file Form 1120S.  And, each stockholder receives a K-1 form, which details their share of the profits, losses, and non-deductible items.  Corporations must file their tax returns 2.5 months after the end of their fiscal year; that would be 15 March for calendar year entities.

Corporations that have not filed Form 2553 are termed “C” Corporations.  These are taxable entities; that means that their profits and losses are taxed directly by the government and the corporation pays those taxes as determined via Form 1120.  Money that may be distributed to the stockholders is income after the tax is paid and are called dividends.  These dividends are taxable income to those that receive them- even though the corporation paid its share of taxes on this income.  Like their S counterparts, C corporations must file their tax returns by 15 March, if they are calendar year entities (or 2.5 months after the end of its fiscal year).

Trusts and Estates are also responsible to file tax returns and pay income taxes.  The form they must file is Form 1041.  Trusts and Estates are allowed to distribute income to beneficiaries; that income is not taxed to the trust or estate, but is taxable to the recipient.  The form filed that describes this distribution is a different K-1 than that filed by partnerships or corporations.  Trusts and estates must file their tax returns 3.5 months after the end of their fiscal year; that means 15 April for calendar year trusts and estates.

Organizations that are exempt from paying tax- foundations and charities- file Form 990. This form details how the money was obtained by the entity, how it was distributed, and the organizational officers.  Assuming the organization employs a calendar year for its fiscal accounting, this form must be filed by 15 May.  (It is always due 4.5 months AFTER the end of the fiscal year.)

Non-taxable organizations that had gross receipts below $ 200K AND  total assets below $ 500K have the ability to file a short form 990, called Form 990-EZ .Like it’s longer counterpart, this form must be filed 4 ½ months after the end of the fiscal year (15 May for Calendar Year organizations).

Of course, if you want assistance, that is EXACTLY what the Adjuvancy provides for you.  We want to make sure you pay the lowest amount of taxes required by law- and that holds for your stockholders, as well.  Call us TODAY, since you have less than 10 or 40 or 75 days left before these documents must be filed.

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