Having “S corp” status means your corporation doesn’t have to pay federal corporate income tax. Instead, the company’s owners report that income (or loss) on their own personal income tax returns.
You do, however, still have to file a tax return: Form 1120-S, the income tax return for S corporations, and which is due on March 15, 2024 if you’re a calendar year corporation.
Here’s what that means for your small business, any other deadlines you should be aware of as an S corp, and how deadlines for S corps differ from other business types.
Suggested resource: 2022 U.S. Federal Tax Prep Calendar
2024 deadlines
January 31, 2024
Form W-2, “Wage and Tax Statement”
If you have employees, you’ll need to fill out two copies of Form W-2, one of which you have to send to the IRS and the other to the employee.
Relevant reading: W-2 and W-4: A Simple Breakdown
Form 1099-NEC, “Nonemployee Compensation”
If you work with independent contractors, Copy A and Copy B of 1099-NEC form must both be sent out by January 31, 2024.
February 28, 2024
Form 1099-MISC, “Miscellaneous Income” (paper filing deadline)
Some of the payees involved in running your business might require a 1099-MISC form instead of a 1099-NEC. Keep in mind that the February 28 due date only applies if you’re filing a paper copy. If you’re filing electronically, you have until March 31, 2024.
March 15, 2024
Form 1120-S, “U.S. Income Tax Return for an S Corporation”
If you’re a calendar year corporation—that is, if your fiscal year lines up with the calendar year—you’ll have to file your S corporation return by March 15th of this year.
If your fiscal year ends on any other day, the last day to submit will fall on the 15th day of the 3rd month after the end of your tax year.
(For example: if your fiscal year ends on January 31st, your deadline is April 15th.)
Form 7004, “Application for Automatic Extension of Time To File Certain Business Income Tax, Information, and Other Returns”
Filers who need more time can submit IRS Form 7004, which grants an automatic six-month extension to submit your business tax paperwork. Just remember that you still have to pay taxes on time and in full.
Form 7004 is due on or before the day that your 1120-S is due.
(For example: if your fiscal year ends on January 31st and your 1120-S deadline is April 15th, then your 7004 deadline is also April 15th.)
How do I file my taxes as an S corp?
S corporations and LLCs filing as S corps use Form 1120-S, the U.S. Income Tax Return for an S Corporation, to submit their federal tax return.
To fill one out, you’ll need the following information on hand:
- General information about your business, including your date of incorporation and the date you elected S corp status
- Your business activity code and your Employer Identification Number (EIN)
- A profit and loss statement and a balance sheet for your business
- Your accounting method: You’ll indicate on the form whether you use cash or accrual accounting
- Information about any payments you made to independent contractors totaling at least $600 for the year (each of whom you should have sent a 1099)
Properly filing a Form 1120-S involves three steps:
1. Fill out page 1 of Form 1120-S
Once you’ve inputted your contact information, dates of incorporation and S corp election, etc. into the general information fields (labeled A-F) at the top of the form, you’ll be presented with three different labeled sections:
Income
This section will ask you about all of your company’s revenues for the year, which is information you’ll get from your income statement.
Deductions
This section will ask you for your business’ deductible expenses for the year, which you’ll also get from your income statement (and hopefully have receipts for).
Tax and payments
You’ll only have to fill this section out if your company began the year as a C corporation and filed for S corp status during the current tax year. You’ll use this section to list any estimated taxes you paid during the year and calculate any taxes you owe or overpaid due to the switch.
2. Fill out the mandatory schedules to 1120-S
In addition to 1120-S, you’ll also have to file Schedules B, D, and K:
- Schedule B will ask you about your business’ accounting methods, stock options, stock it owns in other companies, and its gross receipts.
- Schedule D is where you’ll report any money your company has made or lost on its investments, i.e., its capital gains.
- Schedule K brings together information about your business’ income, deduction, and credits. You’ll need it to file a Schedule K-1, which each shareholder in your S corp must file.
3. File additional (optional) schedules
You might also have to file Schedules L, M-1, and M-2:
- Schedule L is for businesses that either a) had more than $250,000 in revenue this year or b) held more than $250,000 in assets.
- Schedule M-1 is where you’ll indicate why the profits (or losses) you reported in your books are different from the profits you reported on your taxes.
- Schedule M-2 is used to report any changes in retained earnings, which are any profits you held back to reinvest in the business.
As you can see, Form 1120-S is complicated. Our recommendation? Take all the information listed above to an accountant, tax filing professional, or a service like Bench and get an expert to help you file Form 1120-S.
Relevant reading: S Corporation Tax Filing: Benefits, Deadlines, and How-to
What if I elected S corp status this year?
Becoming an S corp involves incorporating as a regular corporation first, then submitting Form 2553 to the IRS (or Form 8832 if you’re an LLC).
In order to file your taxes as an S corporation in the same year that you applied for S corp status, you must file 2553 “no more than 2 months and 15 days after the beginning of the tax year the election is to take effect,” according to the IRS.
So, for example, if your business’ tax year began on January 1st, 2023, and you wanted to be taxed as an S corporation when you file your return for that year in 2024, you must have submitted your 2553 no later than March 15, 2023.
For a more detailed guide to filling out 2553, read our detailed breakdown of how to elect for S corp status with the IRS.
How different states treat S corps differently
State tax rules for S corps vary quite a bit. Many states choose to follow the federal income tax requirements for S corps, but some require you to file additional state forms to be recognized as an S corp. In New Jersey, you have to file Form CBT-2553, for example, while in New York, you have to file Form CT-6.
The District of Columbia, New Hampshire, Tennessee, and Texas don’t even recognize S corp status: you’ll be taxed like a regular corporation in those states even if you’ve filed for S corp status with the IRS.
Meanwhile, states like Louisiana and Mississippi are somewhere in the middle. They don’t necessarily prevent you from passing all of your S corp income through to your investors, but it also depends on your specific tax situation.
Our recommendation is to chat with a CPA or tax professional in your state to make sure you’re following your state’s S corporation rules. If you’re a Bench Premium customer, you’ll also have access to on-demand and unlimited tax consultations with tax professionals who can help you ensure you’re compliant.
How Bench can help
We’ve established that filing S corporation taxes is no small task. Thankfully, Bench can handle your tax preparation for you, taking the stress of the upcoming deadlines off your shoulders so you can stay focused on running your business.
World-class bookkeeping services will have you prepared for anything
Bench’s team of bookkeepers will compile your books every month and prepare your financial statements and other information for tax filing season. We also provide a year end financial package that includes everything you’ll need to file an S corporation tax return.
We’ll do your taxes for you
If you prefer a fully hands-off experience, sign up for our Premium plan, and we’ll even file your taxes for you, making tax time stress and scrambling a thing of the past.
Gain a trusted partner
Bench also provides tax advisory sessions that help business owners better understand their tax situation. This is particularly relevant for S corporations, which tend to receive more scrutiny from the IRS because of the lack of rules around “reasonable salaries.”
With our Premium plan, business owners get access to on-demand and unlimited tax consultations so they can ensure they’re remaining compliant with the IRS while also receiving consultation on tax savings, deduction limits, entity reclassification, and more.
Make sure you’re ready for tax season
Sign up with Bench before February 15 to guarantee your books are caught up for filing—and avoid a 20% rush fee. Update your tax experience with Bench.
Tax extensions
C corps, S corps, LLCs, and partnerships all use Form 7004 to file for an extension on their tax paperwork (unless you’re a sole proprietor, in which case you’ll use Form 4868).
Form 7004 is due on or before the day that your 1120-S is due, which means that if you’re a calendar year S corp, your deadline to file 7004 is March 15, 2024.
Form 7004 grants you a 6-month extension—until September 15, 2024—to file Form 1120-S. However, remember that it doesn’t grant you a tax payment extension.
If you expect to owe taxes, you still have to pay them on time. Check out our guide to estimating your tax liability for determining how much you owe.
Rather than filing a paper 7004 form, you’re likely better off using the IRS’ e-file service. Just create an account to get started, and the website will guide you through the rest of the process.
What happens if I miss the deadline?
It entirely depends on whether you were late filing or late to pay your taxes (or both) because the IRS has separate penalties for each.
The amount of these penalties will depend on two factors:
- How long past the tax filing deadline you submit your taxes or pay them
- How much you owe in taxes in total
If you don’t file your tax return by the deadline (and haven’t filed for an extension), the penalty is 5% of the tax due for each month that return is late.
If you don’t pay your owed tax on time, the standard penalty is 0.5% of the unpaid tax amount for each month it remains unpaid.
Both these penalties max out at 25% of the total tax amount owed. (This means the 5% failure-to-file penalty maxes out after five months.)
If both penalties apply in the same month, the maximum penalty applied is 5%. You pay the 0.5% failure-to-pay penalty and a 4.5% failure-to-file penalty.
When those five months have passed and the failure-to-file penalty has maxed out, the failure-to-pay penalty continues at 0.5% per month, either until you pay or it maxes out at 25%—45 months later.
How do I avoid or reduce my penalties?
The best way to avoid penalties, of course, is making sure your books are tax-ready well before the deadline. If you need help getting your business finances in order, sign up for Catch Up bookkeeping and tax filing with Bench before February 15, 2024.
Since the penalty for not filing your taxes is much larger than the penalty for not paying your owed taxes, we recommend at least filing (or getting an extension on) your tax return.
This removes the 5% failure-to-file penalty and keeps you at the minimum penalty. After you file, pay whatever you can—even if it’s only a portion of your owed amount—to further reduce your accruing penalties.
For businesses concerned about paying their tax bill (or have fallen behind on payments), the IRS Fresh Start program offers flexible options, including payment plans and offers in compromise, for businesses struggling with paying their taxes.
For more detailed information on IRS penalties and how best to avoid them, check out our guide to what happens when you don’t file your taxes for your business.
