On July 31, 2015, a short-term highway funding bill was signed into law. This bill passed with many provisions that will affect your taxes.
One notable change will be revised due dates for partnership and corporate tax returns for years beginning after December 31, 2015 (2016 for calendar year entities):
- Both partnerships and S corporations will have to file their returns by the 15th day of the 3rd month after the end of the year. Therefore, those with a calendar year will have to file by March 15th of the following year. A six-month extension (September 15) can be granted for these returns.
- C corporations will have to file by the 15th day of the 4th month after the end of the tax year. Therefore, those with a calendar year will have to file by April 15th of the following year. A five-month extension (September 15) can be granted for these returns.
These changes are in-line with a more logical flow of information that is needed to prepare these returns. Since the due date of the partnership return was the same date as the due date for an individual tax return, individuals holding partnership interests often must file for an extension to file their returns because their Schedule K-1’s may not arrive until the last minute. The new due dates will help taxpayers will reduce the need for using extensions as the information to file accurate personal returns will be available before the deadline.
The rules vary for fiscal year entities.
STATE OF MICHIGAN
The state of Michigan has decreased the wage base for calculating the state’s unemployment tax from $9,500 to $9,000 starting with the 3rd quarter of 2015. The new lower wage base applies to contributing employers who pay unemployment taxes and who are not delinquent in paying their unemployment contributions, interest and penalties. This change is due to the state’s Unemployment Trust Fund balance reaching $2.5 billion and being expected to remain at that level for 2 consecutive quarters. Please note this change as you prepare to file your 3rd quarter payroll tax reports.
By: Daniel Crawford, CPA