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What is the current status on the Hill in connection to changing the federal-level tax compliance due dates for better tax reporting purposes?

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Peter J. Scalise
On July 31, 2015, President Obama signed into law H.R. 3236 entitled The Surface Transportation and Veterans Health Care Choice Improvement Act of 2015 (hereinafter the “Act”), that is anticipated to be partially paid for by a number of new tax compliance requirements.

The Act amended a number of provisions within the Internal Revenue Code and modified a number of tax return filing due dates for tax years beginning after December 31, 2015 (i.e., the scope and application of the Act will apply to 2016 tax returns) with the intention to create a more logical flow of information and tax reporting. For example, under the Act, the tax return filing due date for Partnerships to file Form 1065 will move up from April 15th to March 15th (i.e., two and a half months after the close of its tax year). This will now mirror the tax return filing due date currently in place for S corporations. This paradigm shift to a March 15th tax return filing due date will better enable partners (e.g., current S Corporation shareholders) to receive their Schedule K-1 in time to report that information on their Form 1040 before its April 15th tax return due date. Unfortunately, many partners have been forced over the years to file for a six month extension of time to file their Form 1040s under the current tax return filing due date requirements.

As a synopsis, the Act has modified many tax return filing due dates with a diverse range of entities being effected but some of the primary tax return filing due dates that have changed are as follows:

➢ March 15 for calendar year Partnerships and S corporations (i.e., the 15th day of the third month after the close of the fiscal year in the case of non-calendar years); and
➢ April 15 for calendar year C corporations (i.e., the 15th day of the fourth month after the close of the fiscal year in the case of non-calendar years).

It should be further duly noted that a special provision applies to C corporations with a fiscal year ending June 30. For these taxpayers, the Act will not apply until tax years beginning after 2025. Consequently, the due date of their tax returns will continue to be two and a half months after the close of the year (i.e., September 15) until their 2026 tax years.

Additionally, the Act adjusts the automatic extension of tax return filing due dates for C corporations for tax years beginning after 2015 and before 2026 to afford:

➢ Calendar year C corporations with an automatic five-month extension;
➢ C corporations with a June 30 fiscal year-end with an automatic seven-month extension; and
➢ Other fiscal year C corporations with an automatic six-month extension.

Beginning with 2026 tax returns, the automatic extension period for all C corporations will be six months.

A copy of H.R. 3236 can be downloaded for your reference at: www.govtrack.us/congress/bills/114/hr3236
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