IRS Proposes To Change Filing Extensions for Some Types of Returns

The IRS is proposing to change the extended due date for certain types of returns. The purpose of the change is to help taxpayers better meet their filing obligations. For the returns impacted, the change reduces the extension period from six to five months. The shorter extension period applies to the following types of returns:

Form 1065 – U.S. Return of Partnership Income
Form 1041 – U.S. Income Tax Return for Estates and Trusts
Form 8804 - Annual Return For Partnership Withholding Tax

Items of income, deduction and credit from partnerships, S corporations, estates and trusts are reported to partners, investors and beneficiaries on Schedules K-1 and other similar statements with the recipients then using that information to complete their own tax returns. Under current law, the due date for both businesses and individuals often fell on the same date – typically October 15. IRS believed that creates a burden to for individual taxpayers who rely on the information from the Schedule K-1 and similar documents to prepare and file their personal tax returns. Thus, IRS is proposing to move the deadline up for the K-1, Form 1041 and Form 8804 from October 15 to September 15.

The proposed change is to be effective for extension requests with respect to tax returns due on or after January 1, 2009, and is to apply to business entities that file the affected returns or have a tax year that ends on or after Sept. 30, 2008. IR-2008-84, Jun. 30, 2008.