JUNE 29 DEADLINE NEARS FOR PUERTO RICO HURRICANE VICTIMS:

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Residents of Puerto Rico, the U.S. Virgin Islands and American Samoa affected by last year’s hurricanes and tropical storms who are required to file a 2017 federal income tax return or pay their 2017 tax, must do so by June 29. This special extended deadline is available regardless of whether a taxpayer’s residence changed during 2017. No interest, late-filing penalty or late-payment penalty will be due. Further, bona fide residents of Puerto Rico, the U.S. Virgin Islands and American Samoa, who permanently relocated to the U.S. mainland due to last year’s hurricanes and tropical storms may need to file Form 8898, Statement for Individuals Who Begin or End Bona Fide Residence in a U.S. Possession, with the Internal Revenue Service along with their Form 1040 or Form 1040NR. Due to the disaster-related extensions granted by the IRS to residents of these three U.S. territories, Form 8898 will generally be due by Friday, June 29, 2018. In addition, anyone who files for an income-tax-filing extension will also have until October 15, 2018, to file Form 8898. This requirement to file Form 8898 applies to anyone who had total gross income exceeding $75,000 for the year, ceased to be, or became, a … Read More

MARCH 15 DEADLINE – PARTNERSHIPS AND S CORPS

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In 2015, the Surface Transportation and Veterans Health Care Choice Improvement Act of 2015 (the Act) was enacted and included a number of tax changes. The key change was to the due date of various business and fiduciary returns in 2017 for 2016 tax returns. The deadline for filing calendar year 2018 partnerships and S corporations is March 15, 2018. These returns must be filed (e-filed or postmarked) by midnight on March 15, 2018. Fiscal year returns will be due the 15th day of the 3rd month following the year-end. Both partnership and S corporation returns are allowed a six-month extension if needed. Payment must accompany the return or extension if there are taxes due. An extension of time to file does not extend the time to pay taxes that are due. The due date for C corporations was also changed and is now due on the 15th day of the 4thmonth. Calendar year returns will be due on April 17, 2018. In 2017 the IRS issued Notice 2017-47 which allowed for relief of those tax returns not filed timely due to the change in the due dates for partnership returns. Such relief is not expected for the 2017 returns due in 2018 and extensions should … Read More

MARCH 1 TAX DEADLINE FOR MANY FARMERS, FISHERS; IRS DIRECT PAY OFFERS EASY WAY TO PAY

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The Internal Revenue Service is reminding farmers and fishers about the March 1 deadline to take advantage of special rules that can allow them to forgo making quarterly estimated tax payments. Anyone with income from a farming or fishing business may be able to avoid making any estimated tax payments by filing their 2017 return and paying the entire tax due on or before March 1, 2018. This rule generally applies if farming or fishing income was at least two-thirds of the total gross income in either 2017 or the preceding tax year. Taxpayers can use IRS Direct Pay to quickly pay an individual tax bill or make an estimated tax payment directly from a checking or savings account at no cost. Payments can be scheduled 24 hours a day, seven days a week, up to 30 days in advance without any fees or pre-registration. When a taxpayer uses IRS Direct Pay, they receive instant confirmation after they submit their payment. Direct Pay cannot be used to pay the federal highway use tax, payroll taxes or other business taxes. Taxpayers who wish to pay their federal business taxes electronically should enroll in the Electronic Federal Tax Payment System (EFTPS), or visit IRS.gov/payments to check … Read More

IRS SETS FINAL 2018 DEADLINE FOR ROTH CONVERSION DO-OVERS

NSTPDeadline, Internal Revenue Service (IRS)

One of the few retirement changes in the tax overhaul was the elimination of do-overs for Roth IRA conversions. It used to be that you could convert a traditional IRA to a Roth IRA one year, and then have until October 15th of the next year to undo the transaction and avoid the tax hit. That move—called “recharacterization”–is no longer allowed under the 2017 Tax Cuts and Jobs Act. But what about taxpayers who made the move in 2017? It was not clear if they only had until December 31, 2017 to unwind transactions, or if they would be allowed the extra time. Now the Internal Revenue Service has spoken in FAQs, and it’s a taxpayer-friendly answer. The IRS website says this under IRA FAQs: What is a recharacterization of a contribution to a traditional or Roth IRA? A recharacterization allows you to treat a regular contribution made to a Roth IRA or to a traditional IRA as having been made to the other type of IRA. A regular contribution is the annual contribution you’re allowed to make to a traditional or Roth IRA: up to $5,500 for 2018, $6,500 if you’re 50 or older. It does not include a conversion or … Read More

USE IT OR LOSE IT: DEADLINE FOR STARTUPS TO CLAIM R&D CREDIT LOOMS

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Startup businesses have one last chance to claim a valuable credit, experts say – but they need to act fast. Before 2016, businesses could only take the Research & Development Credit against their income tax liability. But a provision in the Protecting Americans from Tax Hikes Act, or PATH Act, of 2015, allows eligible small businesses to apply part or all of their research credit against their payroll tax liability, instead of their income tax liability. The option is meant to benefit startups that have little or no income tax liability. The new option was available for the first time for 2016 returns, but under a special rule for tax-year 2016, a small business that failed to choose this option can still make the election by filing an amended return by Dec. 31, 2017. “This is a tremendous opportunity for startups, but the deadline is approaching rapidly,” said Michael Silvio, tax director at Hall & Co. CPAs. “Under the rules, small-business startups may claim up to $250,000 in credits per year against the payroll tax liability instead of the income tax liability. Eligible firms can earmark the credits against payroll for the first quarter after the filing. Businesses that did … Read More

TAXPAYERS ABROAD MUST FILE BY JUNE 15; EXTENSIONS AVAILABLE; NEW FILING DEADLINE NOW APPLIES TO FOREIGN ACCOUNT REPORTS

NSTPDeadline, Taxpayer

The Internal Revenue Service is reminding taxpayers living and working abroad that they must file their 2016 federal income tax return by Thursday, June 15. The special June 15 deadline is available to both U.S. citizens and resident aliens abroad, including those with dual citizenship. For those who can’t meet the June 15 deadline, tax-filing extensions are available and they can even be requested electronically. In addition, a new filing deadline now applies to anyone with a foreign bank or financial account required to file an annual report for these accounts, often referred to as an FBAR. Here is a rundown of key points to keep in mind: Most People Abroad Need to File: An income tax filing requirement generally applies even if a taxpayer qualifies for tax benefits, such as the Foreign Earned Income exclusion or the Foreign Tax credit, which substantially reduce or eliminate U.S. tax liability. These tax benefits are only available if an eligible taxpayer files a U.S. income tax return. A taxpayer qualifies for the special June 15 filing deadline if both their tax home and abode are outside the United States and Puerto Rico. Those serving in the military outside the U.S. and Puerto … Read More