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Massachusetts DOR Announces Late-File Penalty Relief for Corporate Taxpayers

AAFCPAs would like to make clients aware that the Massachusetts Department of Revenue announced relief for corporate taxpayers affected by the change in federal tax return due dates.

The IRS changed the due date for filing calendar year C corporation returns from March 15 to April 15, effective for 2016 tax filings. The Massachusetts legislature did not pass a law conforming to the Federal change. As a result the due date for filing Massachusetts tax returns falls before the new Federal due date, or March 15, 2017.

In response to this situation, the Massachusetts Department of Revenue (DOR) issued Technical Information Release 17-3. According to the release, which was issued “in the interest of efficient tax administration and in order to ease compliance for taxpayers,” the DOR announced it will waive any late-file penalties in connection with a C corporation tax return that is filed after the state due date, but on or before the due date for the corporation’s federal tax return.  This pertains only to Massachusetts C corporation tax returns filed between March 15 and April 15, 2017.

Payment due with the return, if any, remains due on the date prescribed by state law. Accordingly, it is important to note that the DOR will not waive interest charges or penalties for late payment with respect to any taxes paid after March 15, 2017.

In addition, the existing Massachusetts rule governing valid extensions has not changed. To receive an extension of time to file, a corporation filing on a calendar year basis must pay on or before March 15th at least 50% of the total amount of tax ultimately due. This is important for C corporations that also plan to extend their Federal return by April 15 and not avail themselves of the relief granted by this Technical Information Release.

If you have any questions about tax planning or compliance, please contact your AAFCPAs partner or Richard Weiner at 774.512.4078 or rweiner@nullaafcpa.com.

Related insights:

States Not Adopting Federal Due Date Change for C Corporations

About the Author

Richard Weiner CPA
Rich has over 30 years of broad tax experience with a specialty in tax planning and consulting for private and publicly-held businesses. Rich has specific expertise in the Software, Bio-Technology, Medical Device, Life Science, Manufacturing, Retail, Professional Service and Publishing industries, as well as U.S. aspects of international taxation. He works extensively with European companies expanding into the U.S. market. Additional areas of focus include companies and stockholders in transition, including structuring of and planning for Mergers & Acquisitions, planning for changes in ownership and management, and adoption of tax methodologies with a view toward the long term. He is well known in his field and is a frequent speaker on a variety of tax related topics.

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