Analysis of the Modification of Due Dates Proposal in the 2013 and 2014 Proposals

Regarding the Administration’s proposal on modifying due dates –

  1. For Partnerships and Corporations, the Administration’s proposal would be similar to the Jenkins (HR 901) and Enzi (S. 420) bills in that it would have Partnerships file March 15 and Corporations file April 15.
  1. For S Corps, the Administration’s proposal is similar to the Camp proposal (but different from the March 31 due date in S. 420/HR 901 and SFC draft) in that it keeps the current March 15 deadline.
  1. For authority granted to Treasury to modify extended due dates for trusts and estates and other entities (and corporations), the Administration’s proposal is similar to the SFC draft (but different from S. 420/HR 901 and the Camp draft – that includes such authority) in that it does not address extended due dates modifications.
  1. Note: the Camp proposal contains (different from the other proposals – including the Administration’s proposal - that do not contain) the June 30 fiscal year C corporation provision – but is worded different than the Jenkins 112th Congress (HR 2382) bill.
  1. The Administration’s proposal has an effective date that is worded as “returns required to be filed after December 31, 2014,” making it apply to the 2015 filing season, different from the effective date of the other proposals that are worded as “returns for taxable years beginning after December 31, 2014.”
  1. The Administration’s proposal contains (different from S. 420, H.R. 901 and the Camp draft that do not contain in the due dates modification section) language on informations returns due date changes - W-2s to IRS and SSA by 1/31, and Forms 1099-B to IRS by 2/15 . The SFC draft accelerates the current info. reporting 2/28 deadline to 2/21 and requests a report on whether 1/31 is feasible.

Those are the highlights of the Administration’s proposal. Below is a discussion of the differences of the various proposals released in 2013 and 2014 with regard to modification of due dates - S. 420, H.R. 901, SFC discussion draft, Camp discussion draft, and the Administration’s fiscal year 2015 revenue proposal. See attached chart for details comparing the proposals’ suggested due dates for each type of entity. The differences between the proposals are described below.

  1. S Corps –
  1. Administration’s fiscal year 2015 revenue proposal and the Camp discussion draft do NOT change the S Corp due date to March 30, but instead keep it at March 15 – to treat Partnerships and S Corps similarly with a March 15 deadline.
  1. The SFC Draft and S. 420 and H.R. 901 change the S Corp due date to March 30, like AICPA proposed.
  1. Fiscal Year C Corps –
  1. S. 420, H.R. 901, and the SFC discussion draft, and the Administration’s fiscal year 2015 revenue proposal do not have different treatment for fiscal year C Corporations.
  1. The Camp discussion draft proposal raises revenue - $0.1 billion – as it includes a provision on the June 30 fiscal year C corporations. None of the other proposals in 2013 and 2014 contain this June 30 fiscal year C Corp provision.
  1. The Camp discussion draft proposal June 30 fiscal year C Corp provision has an effective date of “not apply to any tax year beginning in 2022.” This “not apply” to one year 10 years out language differs from the language from the 112th Congress Jenkins bill (H.R. 2382) with a similar special treatment for June 30 fiscal year C Corps had an effective date of “ the amendments made by this section shall apply to taxable years beginning after December 31, 2021.”

Statutory language of the 112th Congress Jenkins bill – HR 2382 – was

(d) Effective Dates-

(1) IN GENERAL- Except as provided in paragraph (2), the amendments made by this section shall apply to returns for taxable years beginning after December 31, 2011.

(2) DELAYED DATE FOR C CORPORATIONS WITH FISCAL YEARS ENDING ON JUNE 30- In the case of any C corporation with a fiscal year ending on June 30, the amendments made by this section shall apply to taxable years beginning after December 31, 2021.

Statutory language of the Camp discussion draft is -

“16 (2) SPECIAL RULE FOR C CORPORATIONS WITH

17 FISCAL YEARS ENDING ON JUNE 30.—In the case of

18 any C corporation with a fiscal year ending on June

19 30, the amendments made by this section shall not

20 apply to any taxable year beginning in 2022.”

From the Camp discussion draft summary document –

“The provision generally would be effective for tax years beginning after 2014. For C corporations with fiscal years ending on June 30, the new filing date would not apply to any tax year beginning in 2022.

JCT estimate: According to JCT, the provisions would increase revenues by $0.1 billion over 2014-2023.”

  1. Partnerships – all proposals change the due date to 3/15.
  1. Calendar C Corps – all proposals change the due date to 4/15.
  1. Trusts and Estates and other entities/forms (and Corporations) - extended due dates -
  1. S. 420, H.R. 901, and the Camp discussion draft provide statutory authority for the Treasury to modify these extended due dates in the regulations.

“MODIFICATION OF DUE DATES BY REGULATION” and “Corporations Permitted Statutory Automatic 6-Month Extension of Income Tax Returns.”

  1. The SFC discussion draft and the Administration’s fiscal year 2015 revenue proposal do not contain the language providing statutory authority for the Treasury to revise extended due dates in the regulations as contained in S. 420 (Sections 3 and 4), and H.R. 901, and the Camp discussion draft.
  1. Effective dates –
  1. S. 420 and H.R. 901 and the SFC and Camp discussion draft proposals provide an effective date for the proposed original and extended due dates of“effective for returns with taxable years beginningafter Dec. 31” of the current tax year (i.e., 2014), so the proposed due dates would apply to taxable years starting in the following calendar year (2015 taxable years), and thus apply in the filing season of two more calendar years (i.e. March-October 2016).
  1. The Administration’s proposal would be effective for “returns required to be filed after December 31, 2014,” therefore, the changes would apply for the 2015 filing season.
  1. Information returns –
  1. The Administration’s proposal contains language that is not contained in the other proposals’ revisions to due date sections.

The Administration’s proposal states: “The proposal would also accelerate the due date for filing information returns and eliminate the extended due date for electronically filed returns. Under the proposal, information returns would be required to be filed with the IRS (or SSA, in the case of Form W-2) by January 31, except that Form 1099-B would be required to be filed with the IRS by February 15. The due dates for thepayee statements would remain the same.”

  1. The SFC draft accelerates the information reporting due dates from 2/28 to 2/21 and requests a report on the feasibility of a 1/31 due date.
  1. S. 420, H.R. 901, and the Camp discussion drafts do not contain information reporting language proposals.