S-Corp and Individual Tax Deadlines

[Small Business Owner]

Looking for some guidance on an issue from the knowledgeable posters on this site. Shortly before tax day, I took a six month extension on my taxes, which of course made my new deadline 10-15. The decision has been made that for the first time this year I would file as an S-Corp (technically, an LLC filing as an S-Corp). However, I did not know that the deadline for filing as an S-Corp was 3-15, which means that the six month extension would only extend my deadline to 9-15 (which has passed, obviously) even if I did request an extension specifically on the S-Corp (which I did not).

My accountant tell me that the IRS has a "one time forgiveness policy" on late filings but that just sounds fishy to me, and frankly, I've lost confidence in the past week that he has my best interests at heart (very long backstory there). He says that it's unlikely to be an issue.

So my questions are, is my individual returns timely if filed by October 15th, and just my LLC's filing as an S-Corp late, or does my corporation's late filing make my individual filing late too? Is my LLC filing late less serious than me filing late? Is there this one time forgiveness policy that my accountant refers to? We could still file timely by not filing as an LLC this year, but that would cost me another $4000 in taxes, so I'd prefer to file as an S-Corp obviously, unless its likely to get me into hot water with the IRS (i.e. audited).

Thank you in advance for anyone willing to take the time to bring me up to speed!

 

[ColinCPA]

Don't worry, your accountant is not lying to you. There is a first time abatement of the late filing for s-corporations under IRM 20.1.1.3.6.1. I do this all the time for clients. Have your accountant mail a letter and take care of this for you, as you can expect a late filing notice initially.

Generally, abatement of late filing of LLC partnerships is more forgiving than S-corps. As long as you file the partners' personal returns correctly and on time by the extension deadline, they will generally waive a late filing fee for partnerships upon request. Unfortunately, this doesn't work for S-corps and your only options for S-corps are first time abatement and/or reasonable cause for late filing.

 

[Samir]

Great info Colin. I was aware of the small partnerships abatement clause, but didn't know if something existed for other entities.