United States House of Representatives bill HR 3236 cleared both houses of Congress and was subsequently signed by the President on July 31st. The purpose of the bill was “To provide an extension of Federal-aid highway, highway safety, motor carrier safety, transit, and other programs funded out of the Highway Trust Fund, to provide resource flexibility to the Department of Veterans Affairs for health care services, and for other purposes”. The bill was referred to as the “short-term highway funding extension”.
Why am I referencing this new law in a tax blog, you ask? Well, because this bill also included some fairly substantial changes to several tax filing due dates effective with the 2016 tax year filing season in early 2017. The changes affect tax returns for tax years beginning after December 31, 2015. These changes will not affect the upcoming 2015 tax year filing season early next year, but will take effect for the following filing season.
Form 1065 partnership income tax returns will be due by March 15th rather than the current April 15th due date. Form 1120 C-corporation income tax returns will be due by April 15th rather than the current March 15th due date. Form 1120S S-corporation income tax returns will continue to be due by March 15th and form 1040 individual returns will continue to be due by April 15th. Form 114 FinCEN returns for certain taxpayers with financial accounts in foreign countries will be due by April 15th rather than the current June 30th deadline.
The changes are meant to create a more logical flow of information from flow-through entities to individuals allowing more time to file accurate and complete form 1040 individual tax returns. It will tend to make the March 15th deadline more intense for tax preparers and theoretically reduce the pressure related to the April 15th deadline. However, my guess is that more partnership returns will end up being extended due to missing information needed to complete those returns by the March 15th deadline.
One other provision of the new law is that annual forms 1098 mortgage interest statements will now be required to report the outstanding principal on the mortgage at the beginning of the calendar year, the address of the property securing the mortgage and the mortgage origination date.
These due date changes are noteworthy as the current due dates have been in place since 1955. If you have any questions regarding how these due date changes might affect your tax return filing, please contact us.