By Eva Rosenberg
We start with gentleness from the Internal Revenue Service. Farmers’ and fishermen’s tax returns are normally due on March 1 if they have not made any estimated tax payments during the year. As a result of the delays in getting the tax reporting system booted up this year, the IRS has extended that payment and filing deadline to April 15 this year. Just use Form 2210-F to avoid any penalties. From the IRS: IRS Provides Penalty Relief to Farmers and Fishermen
This day roars like a lion — lots of things are due.
Corporate tax returns are due for 2012 for calendar year corporations — both S and C.
Companies that aren't quite ready to file may request a six-month extension by filing Form 7004 (and the corresponding state form) today.
Of course, if there is any balance on the 2012 corporate tax liability, it is due — even if you file an extension.
If you were thinking about switching your S corporation to a C corporation or vice versa for 2013, you must inform the IRS by filing Form 2553 today.
The first quarter 2013 estimated tax payment is due on this day as well.
K-1s need to be sent, whether they’re ready or not, to: all S corporation shareholders, and all partners of electing large partnerships (100 or more partners).
Since the law requires that these K-1s be sent out this early in the year, they are just like the first batch of 1099s from your brokerage: Not worth the paper they’re printed on. Don’t use the numbers on these early K-1s for anything. The amounts are apt to change dramatically when you get the final, correct version in a couple of months.
Did you know S corporations pay no federal taxes? You can avoid all the estimated taxes and year-end tax liabilities if your small business is an S corporation. There is always a price. The owners give up the right to a whole menu of employee benefits that would be available to them in a C corporation. But … no income taxes, except possibly on the state side — especially in California. California not only has an annual $800 minimum tax on all corporations, limited partnerships and LL-anythings. They also have a 1.5% tax on the profits of S corporations (even more for certain entities).
So how are the taxes on S Corporations paid? By the shareholders — on their personal tax returns. The K-1s distribute each shareholder’s profit and share of certain expenses and credits. The tax is computed on the basis of the individual shareholder’s tax bracket and limitations. MORE