Hi,
If your S-corp or partnership went on extension back in March, the extended federal deadline is Tuesday, September 15. That’s seven days.
Most owners treat this one as low stakes, because a pass-through usually doesn’t owe income tax at the entity level. That’s exactly the trap. The federal late-filing penalty on a Form 1065 or 1120-S isn’t a percentage of what you owe. It’s a flat charge per owner, per month, whether you owed a dollar or nothing at all.
- $255 per partner or shareholder, per month (or part of a month), up to 12 months
- A 4-owner S-corp filing two months late: $2,040, with zero tax due
- A 10-partner firm that lets it slide six months: $15,300
- Most states add a penalty on top, several of them charged per owner the same way the IRS does, and interest runs on all of it
Here’s what’s actually due September 15:
- Federal: Form 1065 and Form 1120-S
That part is the same wherever you operate. What sits next to it isn’t, and that’s where this gets expensive.
Your state almost certainly has something of its own – and it may not look like a tax return. A few examples of how differently this plays out:
- Connecticut wants Form CT-1065/CT-1120SI next Tuesday as well, from every pass-through with Connecticut income, regardless of how much it made or whether it lost money
- Illinois charges partnerships and S-corps a 1.5% replacement tax at the entity level, so “the entity doesn’t pay tax” is simply not true there
- Tennessee has no tax on wage income and still runs franchise and excise tax straight at your LLC or LP
- Delaware charges LLCs and LPs a flat $300 that was due June 1, on no one’s calendar, with no extension available at all
None of those four appear on a federal deadline list, and none of them are unusual. Most states have at least one filing that runs on its own date, applies whether or not you made money, or attaches to the entity you assumed was invisible. If nobody has walked your specific footprint state by state, the honest answer is that you don’t know what’s outstanding.
One more thing that catches people: if your entity made a pass-through entity tax election for 2025, that benefit generally rides on a timely-filed return. Miss the date and you can lose a deduction worth far more than the penalty.
The real problem isn’t this one deadline. It’s that nobody owns the calendar – bookkeeping is one vendor, payroll is another, the return is a third, and the state filings fall through the gaps between them. That’s why we put everything under one roof:
- Monthly and annual bookkeeping with a dedicated bookkeeper
- Full-service payroll, multi-state, plus contractor 1099s
- Sales tax compliance
- Quarterly tax estimates so you know what you owe before April
- Multi-state entity filings tracked on one calendar, so no return lands on you the week it’s due
- A full one hour review of every credit and deduction you qualify for – by the same team that files your return
- Personal and Business tax returns handled by the same team
Reply to this email by tomorrow and we’ll set up a free 15 minute call with our senior tax advisor to go over your situation. Bring your last invoice from your tax advisor/strategist, tax preparer, bookkeeper and payroll provider – so we can discuss how you can have everything under one roof.
Sincerely,
—
George Dimov, CPA
Licensed and Insured
(833) 829-1120 toll free
(212) 994-8081 Fax
www.dimovtax.com