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Tax Return Due Date Changes and Other Items

Published on: 04:00AM Aug 03, 2015

When Congress passed a short-term highway funding bill last week and President Obama signed it on Friday, there were various tax provisions included in the bill.  One that will affect most of our farmers relates to the new due dates for various tax forms.  The major changes are as follows:

  • Partnership tax returns will now be due a month earlier on March 15 (for calendar year returns) instead of April 15.  They will also have an automatic six month extension (same extended due date as current law).
  • Corporations will now be due April 15 instead of March 15 (for calendar year returns). Corporations will be allowed a six-month extension, except that calendar-year corporations would get a five-month extension until 2026 and corporations with a June 30 year-end would get a seven-month extension until 2026. The new due dates will apply to returns for tax years beginning after Dec. 31, 2015. However, for C corporations with fiscal years ending on June 30, the new due dates will not apply until tax years beginning after Dec. 31, 2025.  (Don't ask me why all of the different extended due dates.  I will get a headache explaining it).

These new dates have been promoted for several years by the American Institute of CPAs and many state societies.  This will make the process more logical since many corporations and individuals need partnership information to properly prepare their income tax returns.

Another change is to move up the due date for the Foreign Account Reporting on Form 114 to April 15 from the current June 30.  This is earlier than current requirements, however, taxpayers can now get an automatic six month extension to file this form.  This is a nice feature.

Form 1098 reporting of Home Mortgage interest will now require (1) the principal balance at the beginning of the year, (2) the address of the property, and (3) the mortgage origination date.

For estates required to file an estate tax return, they will now be required to report to the IRS basis information for all assets included in the estate.  The new law indicates that no one can deduct cost basis greater than the amount reported on this information return.  I have not had a chance to review whether the provision "required to file a return" also applies to returns being simply filed for portability purposes.  If so, this provision will apply to substantially more returns than originally thought.  This provision applies for any estate tax returns due after July 31, 2015.

Last, the bill added a provision to overturn the Supreme Court Home Concrete & Supply decision from 2012.  This decision indicated that the six-year statute of limitations did not apply to overstating basis in assets sold.  This new bill changes the law to apply the six-year statute to basis overstatements that cause income tax liability to be understated by at least 25%.

For additional information regarding due date changes on other income tax forms, here is a more detailed analysis from the American Institute of Certified Public Accountants.