For expert Michigan business or corporate tax preparation services, speak with AUSTIN & LARSON Tax Resolution, an experienced Howell, MI based team of IRS Enrolled Agents, Tax Attorneys, and Tax Accountants. Our IRS tax assistance includes business tax preparation services, compliance, audit help, or settling any IRS back tax debt. Our tax preparation services could significantly reduce your business taxes owed when the IRS comes calling. In evaluating your tax payment options, we provide valuable support that Michigan businesses can reliable on and trust. Call us now at 1-866-668-2953 for any business or corporation tax help that you may need.
Businesses, including C-Corporations, S-Corporations, and Partnerships, all have different tax forms and deadlines for filing returns. For instance, a C-Corporation is taxed at the corporate level, whereas partnerships and S-Corporations are both pass-through entities, where the income flows through to the individual return of the owners or partners. Businesses that have employees also need to file payroll tax returns.
C-corporations need to file form 1120, accounting for their income and expenses for the year. C-corporations are subject to double taxation. All income remaining in the corporation at the end of the year is subject to corporate tax, paid by the corporation.
S-Corporations and Partnerships
S-Corporations and Partnerships are pass-through entities. S-corporations are required to file form 1120s and a partnership is required to file form 1065. Unlike a C-corporation, S-corporations and partnerships do not generate their own tax liability. Instead, any net income remaining in the corporation or partnership at the end of the year is distributed out to the owners or partners. Each owner or partner will receive a form K-1 with their distributive share of the income to report on their individual income tax return.
Although the income of partnerships and S-corporations is not taxed at the corporate level, it does not mean that these entities cannot owe their own tax liabilities. Failure to timely file form 1120s or 1065 can result in large failure to file penalties owed by the corporation or partnership. Also, failure to timely file any required 1099s or W-2/W-3 forms can also result in penalties owed by the corporation. These same penalties also apply to a C-corporation. The tax penalties imposed can be quite significant.
Payroll Tax Returns
Any Michigan business with employees is required to file payroll returns. Payroll returns can be filed on form 944 or 941, and 940. Businesses with employees are required to make federal tax deposits and properly file their returns. Form 941 is due quarterly and form 940 is due annually. Failure to timely file or pay your tax deposits can result in very large liabilities for the corporation. If these balances are not paid, the IRS can also look to assess the tax personally against any party that was responsible for paying the taxes that did not.
Resolution of Business Tax Balances
The IRS offers multiple resolution tax settlement options for businesses that are delinquent for back taxes. Depending on the type of tax and amount owed, they offer payment plans based on either a 24-month payment plan or the business’ ability to pay. Businesses may also qualify for a Currently Non-collectible status or an Offer in Compromise.
In most instances, the IRS will assign a Revenue Officer to establish tax resolution. The Revenue Officer will review to make sure that all required tax returns are filed and that the business is making required tax deposits. They will also review all of the financial statements and assets of the business to determine ability to pay. A Revenue Officer also has the ability to assess unpaid taxes from a previously closed business onto a new business owned by the taxpayer in certain circumstances.
What to Do If Your Business Owes Back Taxes to the IRS
Back business or corporate taxes can quickly turn into a huge tax debt that can threaten the viability of your company. While you are trying to resolve your payroll balances from last quarter, new ones are accruing for the current quarter. Meanwhile, interest and penalties are continuing to accrue. Notices are coming in from the IRS, and you are trying to handle the day-to-day issues of your business. Before you know it, three years have gone by and the business owes a debt that it cannot afford to pay back in full. Then you are contacted by a IRS Revenue Officer that wants to comb through all of your business records.
If your business owes back taxes, do not wait to seek help. At AUSTIN & LARSON Tax Resolution, we can assist your Michigan business with getting back on track with your back tax liabilities. We will be your advocate with the IRS, working tirelessly to get your outstanding business tax returns filed and get your outstanding business IRS liabilities resolved. Let us handle the IRS while you focus on running your business. Call 1-866-668-2953 now. We will be honored and eager to discuss and implement your optimal tax relief solution.