Filing an Extension Application for Corporate or Partnership Taxes
Dates and Process for Filing an Extension Application - Form 7004
Considering filing a business tax return extension?
Form 7004 is the form used to file for an automatic extension of time to file your business tax return for a partnership, a multiple member LLC filing as a partnership, a corporation, or s-corporation.
You must file this extension by the due date of your business tax return. This is an automatic extension, so you don't have to worry about your extension being approved.
Taxes must be paid by due date
The IRS says, "Form 7004 does not extend the time for payment of tax." You must pay taxes due (estimated) by your tax return due date, even if you file an extension application. You will need to estimate as best you can because under-estimating can subject your business to fines and penalties.
Due Dates for Returns and Extension Applications
The due date for partnership and multiple-member LLC tax returns has changed, effective with 2016 tax returns and into the future. Partnership tax returns are now due on the 15th day of the third month after the end of your fiscal (financial) year. Since your partnership must end on December 31, the due date is March 15. (The old due date was April 15).
Tax return due dates vary by year. If the due date is on a weekend or holiday, the actual due date for that year is on the next business day.
The taxes due must be estimated and the balance paid at the time the return is filed.
Corporate tax returns: Corporation tax returns are due and taxes are payable on the 15th day of the fourth month after the end of the company's fiscal (financial) year (effective with 2016 tax returns), on Form 1120.
So, a corporation with a year-end date of December 31 must file and pay taxes by April 15.
When the Extension Expires (and the Return is Due)
Corporations and S corporations have six months from the extension due date to file the tax return. So, a December 31 corporation would have until October 15 to file the appropriate tax return.
Partnerships and multiple-member LLC's have six months from the extension due date to file the tax return. So, a partnership would have until September 15 to file the partnership tax return.
How to Complete Form 7004 for Business Tax Return Extensions
Form 7004 is used to file an extension application for corporations, S corporations, partnerships, and multiple-member LLC's filing as partnerships. Form 7004 is a short form, by IRS standards. It only requires you to:
Enter the code for the tax return you are preparing (the codes are listed.
- Form 1065 for partnerships and multiple member LLCs
- Form 1120 for corporations
- Form 1120S for subchapter s-corporations
The form asks if your business qualifies under Regulations section 1.6081-5,.This section related to foreign corporations, domestic corporations that transact business and keep books outside the U.S., or domestic corporations whose principal income comes from U. S. possessions.
Indicate if this is a short tax year, and check the box for the reason for the short year.
Show the tentative total tax. This is the amount of tax due for the business for that year. Even though you don't have your return done, you will need to do some calculations to get this number.
Show the total payments and any credits applied to your account, and subtract this number from the tentative total tax.
Finally, show the balance due. You can pay by debit or credit card (use your business account.
How to File Form 7004
The IRS has a chart showing where to file Form 7004, depending on the tax return being filed and the location of your business.
If you don't have a tax preparer filing your return, the IRS suggests that you use the Modernized E-File system to e-file your extension application. This system allows you to choose a provider from a list.
More information from the IRS about Form 7004 (PDF)