The Surface Transportation and Veterans Health Care Choice Improvement Act of 2015 was signed into law on July 31, 2015. This legislation changes the IRS return due dates going forward and the IRS audit period.
IRS Return Due Date Changes
Starting after December 31, 2015:
- Partnership tax returns are due March 15, NOT April. If your partnership isn’t on a calendar year, the return is due on the 15th day of the third month following the close of your tax year.
- C corporation tax returns are due April 15, NOT March 15. For non-calendar years, it is due on the 15th day of the fourth month following the close of the tax year. For C corporations with tax years ending on June 30 will continue to have a due date of September 15 until 2025. For years beginning after 2025, the due date for these returns will be October 15.
- S corporation tax returns remain unchanged—they are still due March 15, or the third month following the close of the taxable year
- FBARs filing deadline changes from June 30th to April 15th. 6 month extensions are now available.
Changes to IRS Audit Period
Prior to the IRS statute of limitations for audit was generally 3 years or 6 years for substantial understatement of income (if you omitted more than 25% of your gross income). The Supreme Court in U.S. v. Home Concrete & Supply, LLC (2012) held that overstating your tax basis was not the same as omitting income. The Surface Transportation and Veterans Health Care Choice Improvement Act of 2015 over rules the Supreme Court’s 2012 decision. Now, following this new legislation, the tax code says: “An understatement of gross income by reason of an overstatement of unrecovered cost or other basis is an omission from gross income.” The change applies to tax returns filed after July 31, 2015. It also applies to previously filed returns that are still open. This means that overstating your tax basis is the same as omitting income for purposes of the IRS statute of limitations for audit.
For further information on this topic please contact Christopher J. Byrne at (212) 239-1931