Income Tax Deadlines: When Are Taxes Due? 2021 Filing & Extension Deadlines
Small business owners need to keep an eye on their income tax deadlines. It’s essential to file your tax return on time and pay estimated taxes by the due dates. If you don’t, you could invite IRS penalties.
Tax season can be a stressful time for small business owners. Late filing of your federal income tax return can mean paying a failure-to-file penalty to the IRS. Additionally, a penalty may also apply if your estimated tax payment calculations have been off the mark.
However, if you keep your paperwork organized and carefully track your tax deadlines, you can avoid these problems.
In this post, we’ll tell you about the 2020 tax deadline and the steps you need to take if you think you’re going to miss your tax day. We’ll also provide you with a list of tax-related dates that you need to keep a note of in your calendar. Finally, we’ll tell you about the penalties involved if you don’t pay your taxes or fail to file your return.
Filing and extension deadlines
April 15, 2021, is tax day for most small business owners. According to IRS rules, calendar year filers (those who consider the tax year to be the 12 months from January 1 to December 31) must file their income tax return by April 15 of the following year.
Here’s what you need to do to ensure you comply with the IRS rules regarding the tax-filing deadline:
- Make sure that the envelope containing your 2020 tax return is properly addressed and postmarked. It’s essential to deposit the return in the mail on or before the due date.
- You can also file your return electronically. The April 15, 2021 deadline remains the same. It may make sense to e-file instead of sending your return by snail mail as electronic filing could help you get your tax refund faster.
What if you miss the last day to file taxes?
Although tax deadline 2020--the date by which you need to file your return for the calendar year 2020--is April 15, 2021, you’re allowed to request an extension of time to file.
Every filer is permitted an automatic 6-month extension. However, to get this IRS extension, you must file Form 4868 by the due date of your return (April 15, 2021). Bear in mind that the 6-month extension to file your return doesn’t give you additional time to pay your taxes. If you delay tax payments, you may be required to pay a late payment penalty.
Important tax deadlines in 2021
April 15 isn’t the only date that you need to remember. Several other tax deadlines are of relevance to small business owners. Here’s a list that you may find useful:
March 1: This is the last date to mail Form 1099-MISC to the IRS. Form 1099-MISC reports several types of payments made by businesses. Businesses should have sent the form to recipients by February 1.
March 15: Partnership returns and S-corporation returns are due on this date. The extended deadline is September 15.
March 31: 1099-MISC due date for electronic filing.
April 15: In addition to being tax deadline 2020, this is also the last day to pay your 2020 taxes.
April 15: Estimated tax for the period January 1 to March 31 is due on this date. Remember that here we’re referring to the first estimated quarterly tax payment for 2021.
June 15: This is the date by which you need to pay the estimated tax for the April 1, 2021 - May 31, 2021 period.
September 15: Date by which estimated tax for the June 1, 2021 - August 31, 2021 period is payable.
October 15: Due date for filing your 2020 tax return if you have received an extension.
January 15, 2022: Deadline for estimated tax payment for the September 1 - December 31 period.
Penalty for underpayment of estimated tax and failure to file
In the previous section of this post, we provided the deadlines for estimated tax payments for 2021--April 15, June 15, September 15, and January 15, 2022. Here’s a chart that summarizes the deadlines and the periods for which the payments are due:
Deadlines for estimated tax payments for 2021
|
Tax payment for the period |
Deadline for payment |
|
January 1 to March 31 |
April 15 |
|
April 1 to May 31 |
June 15 |
|
June 1 to August 31 |
September 15 |
|
September 1 to December 31 |
January 15, 2022 |
Estimated tax is payable by sole proprietors, partners, and S corporation shareholders if they expect their total tax to be $1000 or more. Underpayment can lead to a penalty. However, if the amount you owe is less than $1000, the penalty may not be payable. Another way to avoid the penalty is to pay at least 90 percent of the tax for the current year.
What’s the penalty you can expect to pay? If payment is made late, a sum of 0.5 percent of the unpaid tax is payable for every month that you delay the payment. This is subject to a maximum of 25 percent of the total tax.
There’s a failure-to-file penalty, as well. This is payable if you file your return after the due date (or extended due date). The failure-to-file penalty is 5 percent of the unpaid taxes for each month that the tax return is late.
The bottom line
It’s best to prepare well in advance for tax season. Keep in touch with your tax accountant so that there’s plenty of time to calculate your estimated taxes as well as work on your income tax return. If you do this, you’ll be in a position to file your tax return on time and avoid the IRS penalties for failure-to-file and underpayment of estimated taxes.
