The IRS has announced that it will begin accepting and processing electronic and paper returns on Monday, January 23, 2017. The deadline to submit 2016 tax returns will be Tuesday, April 18, 2017, due to the usual April 15 deadline falling on a Saturday and a Washington D.C. holiday, Emancipation Day, falling on Monday April 17, 2017. There are several changes in due dates that taxpayers must be mindful of. Partnerships and entities taxed as partnerships will have to file their Forms 1065 by March 15 or the 15th day of the third month following the end of the organization's fiscal year, rather than the previous April 15 due date. C Corporations filing Forms 1120 will now be due April 15 or the 15th day of the fourth month following the end of the organization's fiscal year, rather than the historical date of March 15. However, a special rule delays the due-date change for C Corporations with a fiscal year ending on June 30 until December 31, 2025; until then, returns for such corporations are due by the 15 day of the third month following the close of the fiscal year. Trust and Estates filing Form 1041 returns now have a five-and-half-month extension available until September 15, rather than September 30. The Report of Foreign Bank and Financial Accounts, Form 114, is now due April 15 and may be extended by up to six months. The Annual Return to Report Transactions with Foreign Trusts and Receipt of Certain Foreign Gifts, Form 3520, is now due April 15 and may also be extended up to six months. Annual Reports of Employee Benefit Plans, Form 5500, now have a three-and-a-half-month extension available. These changes incorporated in H.R. 3236, which was signed in July 2015, are intended to improve the flow of information to pass-through entity owners.
The IRS also cautioned that certain taxpayers claiming the Earned Income Tax Credit ("EITC") and the Additional Child Tax Credit ("ACTC") will have to wait for refunds until February 15, 2017. This is a result of Section 201 of the Protecting Americans from Tax Hikes Act, enacted in 2015, which mandates that no credit or refund for an overpayment for a taxable year shall be made before February 15 if the taxpayer claims the EITC or ACTC. Additionally, the IRS further warned taxpayers that actual access to the refunds may not come until February 27, due to weekends and the President Day holiday.
The IRS also reminded taxpayers to maintain prior-year tax returns and records for at least three years and, if they are switching tax software, they will need the 2015 adjusted gross income from their 2015 return in order to file their returns electronically. The Electronic Filing Pin is no longer an option, and the prior year's adjusted gross income must be used to file electronically.
E-filing and direct deposit for a refund remains the quickest and safest way to file an accurate income tax return and receive the refund promptly. The IRS anticipates issuing 90% of individual refunds in less than 21 days for those filing returns electronically.
“For this tax season, it’s more important than ever for taxpayers to plan ahead,” IRS Commissioner John Koskinen said. “People should make sure they have their year-end tax statements in hand, and we encourage people to file as they normally would, including those claiming the credits affected by the refund delay. Even with these significant changes, IRS employees and the entire tax community will be working hard to make this a smooth filing season for taxpayers.”