If you have an open or closed business that hasn't filed corporate taxes, you are probably wondering "when is the IRS going to contact us?" Or "will we get audited? "Could officers go to jail?" All of these are plausible fears. As we reach 2018, The IRS is shifting their resources towards auditing Corporations and companies who haven't filed their 1120's.
Here are a couple of relevant points/questions for Corporations that haven't filed:
- Are you a valid corporation in your State? Being a valid corporation means paying an annual fee in your State. Every Secretary of State has a look-up feature where you can check your corporation's validity: Secretary of State Website. If you aren't a valid corporation any longer or quit being a valid a few year's back, your approach to compliance is going to be much different. We call non-valid corporations...
- "Just-Kidding Corporations" - if you aren't a valid corporation (see above) or have never filed a corporate return, we might consider you a "just-kidding corporation" and likely bring you into compliance as a "sole-proprietor" and file your business returns as a 1040 - Schedule C or individual return. It depends on how many years that are unfiled to your record keeping in how we decide.
- What if the business was closed? You might have our staff research your IRS record to see what would be the best way to handle your closed business to insure that the tax problem does not trickle down to yourself individually. Solutions range from filing all of the corporate returns, filing a final form to show IRS you are officially closed to letting you decide if you want to do nothing after reviewing the odds/pros and cons.
- You haven't Filed your Payroll Taxes (941's) Either! Non-filers of 941's have a lot to be concerned about as payroll taxes can be assessed individually to officers as "Trust fund taxes." Important questions to non-filers of 941's is whether you gave your employees W2's and submitted both your W2's and W3's to the Social Security Administration. Action or non-action will have to gauged upon a careful analysis of the legal ramifications, liability individually, etc. The IRS will have three years to assess you individually.