Form 1120-S — S-Corporation Annual Return
Annual federal income tax return for US S-corporations. Due 15 March for calendar-year filers. 6-month automatic extension via Form 7004 to 15 September.
Who this applies to
- All US S-corporations (entities that elected S status via Form 2553)
- LLCs taxed as S-corps after Form 2553 election
What to file
Form 1120-S with K-1s for each shareholder, P&L, balance sheet, M-1 reconciliation, basis tracking schedules.
How to file
Electronically via authorized e-filers. Send each shareholder their K-1 by 15 March (so they can file personal returns by 15 April).
Payment due
S-corp doesn't pay federal income tax (pass-through). Shareholders pay tax on their K-1 portion via personal Form 1040.
Penalties for missing this deadline
Late filing penalty: $245 per shareholder per month, max 12 months. Late K-1 distribution to shareholders has a separate $310 penalty per K-1.
Filing checklist
- Confirm reasonable compensation paid to shareholder-employees as W-2 wages
- Reconcile book to tax (Schedule M-1)
- Update shareholder basis schedules
- Generate K-1 for each shareholder
- Distribute K-1s by 15 March
- File Form 1120-S electronically
Common mistakes to avoid
- Under-paying owner W-2 wages (the #1 IRS S-corp audit issue)
- Forgetting state S-corp tax (some states tax S-corps directly)
- Missing the K-1 distribution deadline ($310 per K-1 penalty)
- Not tracking basis — affects future distributions and loss deductions
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