Some small businesses and entrepreneurs, including sole proprietorships, C-Corporations, and some LLCs, don’t have long to file their taxes when they received a renewal earlier this year.
Originally due May 17, applicants have until October 15, 2021 to file their 2020 extended tax returns.
The deadline for filing the tax extension is October 15th
If the return is not submitted on time, there will be a penalty for not submitting 5% of the duties owed per month, up to a maximum of 25%. When a refund is due, there is usually no penalty for not filing. However, small businesses and sole proprietorships can risk losing their money if filed too late.
According to the IRS, the October 15 deadline applies to most taxpayers, with a few exceptions.
Exceptions include members of the military or soldiers serving in a combat zone, who generally have 180 days after leaving the country to file declarations and pay taxes.
Taxpayers in disaster areas declared by the federal government that have already had valid extensions are also excluded.
How to Make Federal Tax Payments
Businesses and sole proprietorships can make tax payments online through the IRS site, by mail, or through the IRS2Go mobile app.
The renewal for individuals filing their 2020 declaration was announced by the Treasury Department and the Internal Revenue Service in March 2021. IRS Commissioner Chuck Rettig said the extension should “help taxpayers cope with the unusual circumstances surrounding the pandemic.”
“Even with the new deadline, we urge taxpayers to consider filing as soon as possible, especially those who are owed refunds. Electronic filing with direct deposit is the fastest way to get refunds and can help some taxpayers get the remaining stimulus payments they may be entitled to faster, “Rettig said in a statement at the time of the announcement.
As the deadline approaches, the IRS expects millions of returns.
It is important that small business owners not only file their tax return before the deadline, but that the form is submitted correctly to avoid delays.
One of the most common reasons for delays in processing tax returns is incorrect tax returns. Another reason is suspicion that the return item may have been attempted identity theft or fraud.
The return could also be delayed if the person applied for the earned income tax deduction or the additional child tax credit.
The return may also be delayed if further verification is required.
To avoid penalties, anyone who has extended their tax filing obligations should submit their form before the looming October 15 deadline.