Business - Return Filing Requirements / Classification

The type of income tax return a business is required to file depends on the type of entity and how the business is organized. In general, S corporations file Form 1120-S U.S. Income Tax Return for an S Corporation, multi-member partnerships file Form 1065 U.S. Return of Partnership Income, and C corporations file Form 1120 U.S. Corporation Income Tax Return.

S corporations

To be treated as an S corporation and file the 1120-S, a corporation must make an S election by filing Form 2553, Election by a Small Business Corporation. This form must be completed and filed no later than two months and 15 days after the beginning of the tax year the election is to take effect. If filed at any later date, the S election will likely take effect the following tax year. Once the IRS has accepted the election, the S corporation should file Form 1120-S as long as the election remains in effect since the election remains in effect until it is terminated. Do not file Form 1120-S for any tax year before the year the election takes effect, or before receiving notification of IRS acceptance of the election, as the IRS will likely reject your return because the filing type is not consistent with the IRS records.

Partnerships and LLCs

In general, all partnerships that consist of two or more partners, as well as entities formed as limited liability companies (LLC) under state law and treated as partnerships for federal income tax purposes, must file Form 1065. Single-member LLCs that are owned by a sole individual are not allowed to file Form 1065 and must report LLC income and expenses on Form 1040, Schedule C, E, or F. For additional information regarding reporting requirements for LLCs, please refer to IRS Publication 3402 Taxation of Limited Liability Companies.

C corporations

Domestic corporations must generally file Form 1120, if the election has not been made to be treated as an S corporation as previously discussed.

Note that any link in the information above is updated each year automatically and will take you to the most recent version of the webpage or document at the time it is accessed.