Tax Tip of the Week | No. 320 | Buried Tax Law Changes - Part 1

Tax Tip of the Week | September 16, 2015 | No. 320 | Buried Tax Law Changes - Part 1

A new temporary highway funding bill recently became law. Buried within this temporary bill (the highway money runs out again October 29, 2015) are several tax law changes that have nothing to do with highway funding.  Most of the tax law changes are effective after December 31, 2015 or for the 2016 tax year.We are going to take a look at four of the most significant tax law changes this week and next week.Tax Return Due Date ChangesFor partnership returns, the new due date is March 15 (for calendar-year partnerships) and the 15th day of the third month following the close of the fiscal year (for fiscal-year partnerships). Currently, these returns are due on April 15, for calendar-year partnerships. The act directs the IRS to allow a maximum extension of six months (formerly five months) for Forms 1065, U.S. Return of Partnership Income.For C corporations, the new due date is the 15th day of the fourth month following the close of the corporation’s year. Currently, these returns are due on the 15th day of the third month following the close of the corporation’s year.Corporations will be allowed a six-month extension, except calendar-year corporations would get a five-month extension until 2026 and corporations with a June 30 year end would get a seven-month extension until 2026.The new due dates will apply to returns for tax years beginning after Dec. 31, 2015. However, for C corporations with fiscal years ending on June 30, the new due dates will not apply until tax years beginning after Dec. 31, 2025.FinCEN 114 ReportingThis form is required if you have over $10,000 in a foreign account. Previously, this form was required to be filed by June 15th and did not allow for any extension of time to file.This new law is effective for returns beginning after December 31, 2015. This means FBAR reports for 2016 will now be due April 15, 2017 (the same day as your tax return).  This new law also allows for the same six month extension available for your tax return (an October 15th due date).The new law also provides that for any taxpayer required to file the FinCEN 114 for the first time, any penalty for failure to timely request or file an extension may be waived by the IRS.More next week….You can contact us in Dayton at 937-436-3133 and in Xenia at 937-372-3504.  Or visit our website.Rick Prewitt – the guy behind TTW...until next week.