UPDATE: The IRS extended the tax deadline for 2021 from April 15 to May 17 for all individuals. This extension applies to self-employed individuals but not small businesses. Read on to learn more.
The 2021 tax season is upon us, but for small businesses it seems like every season is tax season. Small businesses have regular intervals of tax filings and payments that individuals and larger companies don’t face. Rather, small businesses face a tax year full of payment deadlines. It’s important to file these payments correctly and on time, otherwise late or incorrect tax payments can incur hefty fees.
At Divvy, our mission is to help small businesses manage their finances better, and today we’re sharing the deadlines you need to know for your small business taxes. We’ll start with the calendar overview and then break down the most important due dates.
Small business tax calendar for the 2021 tax year
|Deadline||Taxes due||Business type|
|Q1 (January 1-March 31)||Monthly on the 15th (smaller companies) or Weekly (larger companies)||FICA taxes||Any business with employees|
|February 1||W-2 & 1099 Form submission||Any business with employees|
|February 28||ACA Form 1095-C||Employers required to provide healthcare coverage|
|March 1||Form 1099-MISC filing||For certain 1099 payments|
|March 15||Annual taxes||Partnerships
|April 15||Quarterly taxes for Q1||S- and C-Corporations
|Q2 (April 1-May 31)||April 15||Annual taxes (postponed in 2021)
State taxes (varies by state)
File for deadline extension
|April 30||FUTA taxes
Report FICA & FUTA withholding
|Any business with employees|
|May 17||Extended deadline for 2020 annual federal taxes||Individuals|
|June 15||Quarterly taxes for Q2||S- and C-Corporations
|June 30||FUTA taxes||Any business with employees|
|July 31||Report FICA & FUTA withholding||Any business with employees|
(June 1-August 31)
|September 15||Quarterly taxes for Q3||S- and C-Corporations
|September 15||Extension deadline for annual taxes||S-corporations
|September 30||FUTA taxes||Any business with employees|
|October 15||Extension deadline annual taxes||Sole proprietorships
LLCs taxed as disregarded entity
|November 2||Report FICA & FUTA withholding||Any business with employees|
(September 1-December 31)
|January 15 of following calendar year||Quarterly taxes for Q4||S- and C-Corporations
|January 31 of following calendar year||FUTA taxes||Any business with employees|
|February 1 of following calendar year||Report FICA & FUTA withholding||Any business with employees|
*These deadlines are dictated by the IRS. Please consult your tax professional, as well as state and local deadlines pertinent to your business location.
Breakdown of tax types
Only certain businesses are required to file each tax type. Here’s a breakdown of all of the taxes you may be required to pay as a small business.
Due April 15, June 15, September 15, January 15 during the 2021 tax year
As a small business owner, you’re responsible for managing your own taxes (and those of any employees you’ve hired). Taxes can be complex, and there is a sliding scale for the amounts you’ll owe, so to make it easier the IRS has developed a pay-as-you-go estimated tax system. Businesses and individuals compute how much they’re likely to owe in corporate income tax, employment, and other applicable taxes and then divide them into quarterly estimates which are met throughout the year.
The taxes paid by small businesses quarterly include:
- Income tax payments: pay-as-you-go on income earned, both federal income tax and state (depending on your state guidelines)
- Sales tax payments: a state tax on goods sold (not IRS)
- Employment tax payments: Social Security & Medicaid paid on the behalf of employees
- Self-employment tax payments: Social Security & Medicaid paid by self-employed individuals
- Excise tax payments: specialized taxes for certain industries (i.e. environmental, gambling, etc.)
- Franchise tax: required of companies with a nexus in a particular state
These estimated income tax payments are made on the 15th after each quarter concludes: April 15, June 15, September 15, January 15. At your annual income tax filing it will be determined if you’ve paid the appropriate amount in estimated taxes throughout the year.
Not sure how much you should be paying in quarterly business taxes? Learn how much you should be paying in quarterly taxes.
Due April 15 during the 2021 tax year
These are the personal income taxes and corporate income taxes regularly filed by businesses and individuals each spring, including an overall assessment of the amount of taxes paid during the year and what is still owed. The due date of April 15 is well known for this filing deadline, and small businesses should take advantage of this filing to deduct business expenses to maximize their return.
Monthly or semiweekly
Payroll taxes are a blanket term for FICA and FUTA withholdings made by employers on behalf of the employee. These taxes are withheld from each paycheck.
If your company makes an annual payment of employment taxes less than $50,000, you can make monthly deposits of these withholdings. Larger companies make deposits following each pay cycle and based on their payday (later in the week means a Wednesday deposit, weekend or early week means a Friday deposit).
Federal Insurance Contributions Act (FICA) taxes fund Medicare and Social Security payments. This Act requires 15.3% of your income to pay into Medicare and Social Security funds. Employers withhold 6.2% of your pay for Social Security and 1.45% of your pay for Medicare, and then match those contributions to reach the 15.3%. Self-employed individuals make the total 15.3% payment by themselves and then deduct half during their annual return.
Federal Unemployment (FUTA) is a little more complicated to calculate. Small businesses owe 6% of the first $7,000 paid to each employee. If you pay state unemployment taxes you’ll get a credit to apply toward Federal unemployment taxes (up to 5.4%). If you’ll pay more than $500 in FUTA, you should break it into your quarterly payment schedule.
Non-payment filings: Whether you pay your FUTA & FICA monthly or quarterly you need to file your withholdings on a quarterly basis. Fill out and submit Form 941 on April 30, July 31, November 2, and February 1.
Tax deadline FAQs
What’s the penalty for a late tax payment?
Generally you’ll have to pay 0.5% of your unpaid tax amount each month past due up to 25% of your total tax bill. Failing to pay your taxes will incur an outstanding tax bill, which will eat away at any future tax returns and could require a levy or repossession of your property to pay your balance. Jail time is also a consequence of failing to pay or tax evasion.
Can I get a tax extension?
Yes, businesses needing more time to complete their annual filing may request an extension with the IRS. While not guaranteed, the extension request gives you a 5-6 month extension if approved. Sole proprietors and single member LLCs file Form 4868 and other business types file a Form 7004. S-corporations and partnerships must complete their returns by September 15 and sole proprietorships, LLCs, and C-corporations have until October 15.
When can I file my annual taxes?
You can file your annual return after January 1, though most employers file after providing W-2 and 1099 forms to employees on February 1.
How do I make tax payments?
Tax payments can be mailed or submitted online. If you use IRS Direct Pay you will have up to midnight of the due date to file taxes and submit payments via credit card or debit. State payments will vary based on location.
When will I get a tax refund?
Your tax return usually comes within three weeks of the IRS receiving your taxes.
What employee tax forms do I need?
Employers are required to provide W-2 and 1099 forms to report and verify staff employment. Each employee should have their forms by February 1. It is your responsibility to provide these forms or to ensure that your third party payroll provider does so by the due date. Submit these forms to the IRS information returns system.
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