IRS Simplifies Filing Deadline Extension For Business Taxpayers

by Leroy Baker, Tax-News.com, New York

20 February 2006

The Internal Revenue Service has simplified the process for business taxpayers filing for an extension, by reducing the number of forms that businesses are required to file from four to just one.

Under the changes, all business taxpayers who previously filed extension forms 8800, 8736, 7004 and 2758 will now only need to file the revised Form 7004, otherwise known as: 'Application for Automatic 6-Month Extension of Time to File Certain Business Income Tax, Information, and Other Returns,' to request an automatic extension of time to file.

The revised Form 7004 grants taxpayers an automatic six-month extension without the need to file intervening forms.

However, the IRS said that for the 2005 filing season, business taxpayers must file Form 7004 by the due date of the return in order to receive an automatic six–month extension of time to file. The extension period is calculated from the due date of the return.

The new regulations have made this option available to most non-corporate business taxpayers, including partnerships and trusts. Previously, only corporations could request an automatic six-month tax-filing extension.

A similar change was also made recently for individual taxpayers.

Changes have also been made to the processes for obtaining extensions for filing estate and gift tax returns as a result of revisions to Form 4768, otherwise known as: 'Application for Extension of Time To File a Return and/or Pay US Estate (and Generation-Skipping Transfer) Taxes.' This change allows a single six-month extension for all Form 706 return filing, although the request must be made on or before the due date of the Estate Tax Return in order to be accepted.

"Simplifying, consolidating, and standardizing extension forms is expected to reduce taxpayer burden and will also reduce taxpayer confusion and error about filing the correct form," the IRS said in a statement.

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