830 CMR 62C.11.1: Return Due Dates for S Corporations Included in a Combined Group

Date: 03/23/2018
Organization: Massachusetts Department of Revenue
Regulatory Authority: Massachusetts General Laws
Official Version: Published by the Massachusetts Register

830 CMR DEPARTMENT OF REVENUE
830 CMR 62C.00:  STATE TAX ADMINISTRATION
830 CMR 62C.11.1:  Return Due Dates for S Corporations Included in a Combined Group

Table of Contents

(1) Scope of Regulation; Background; Outline of Topics; Effective Date

         (a)    Scope of Regulation.  830 CMR 62C.11.1 sets forth the corporate excise return due date for an S corporation that is included in a combined group.

         (b)    Background.  A combined group is required to file a combined report pursuant to M.G.L. c. 63, § 32B that includes the income and other attributes of all members of the combined group.  The filing of a combined report satisfies the return filing requirements under M.G.L. c. 62C, § 11, ¶ 1 for any business corporation that, pursuant to such report, calculates and reports its own individual corporate excise liability based on the income and non-income measures of the corporate excise, or the minimum excise, as applicable, under M.G.L. c. 63, §§ 32D or 39.  M.G.L. c. 62C, § 11, ¶ 2. The principal reporting corporation is required to file the combined report on behalf of the combined group.  830 CMR 63.32B.2(11). The combined report is also used to report a taxable member’s non-income measure of the corporate excise when such member’s taxable year is the same as the year used for the combined report.  An S corporation taxable under M.G.L. c. 63, § 32D is includible in a combined report.  See 830 CMR 63.32B.2(4)(b).

                 St. 2017, c. 5, §§ 11-14 (“An Act Making Appropriations for the Fiscal Year 2017 to Provide for Supplementing Certain Existing Appropriations and for Certain Other Activities and Projects”) amended M.G.L. c. 62C, §§ 7, 11, and 12 to conform the due dates for Massachusetts partnership and business corporation tax returns to the federal due dates for such tax returns, beginning with tax returns due on or after January 1, 2018. Under prior law, all business corporations, including S corporations, were required to file a corporate excise return on or before the 15th day of the third month following the close of each taxable year. Accordingly, the principal reporting corporation of a combined group was required to file a combined report on behalf of the group on or before the 15th day of the third month following the close of the taxable year of the group. Under the new statutory rules, an S corporation is required to file a corporate excise return on or before the 15thday of the third month following the close of each taxable year, and a business corporation that is not an S corporation is required to a file a corporate excise return on or before the 15th day of the fourth month following the close of each taxable year. This divergence in due dates means that the return due date for the taxpayer members of a combined group may differ when the combined group includes an S corporation even when all such corporations share the same taxable year.  830 CMR 62C.11.1 is being promulgated to clarify the corporate excise return due date in the case of an S corporation that is a member of a combined group.  

         (c)    Outline of Topics.  830 CMR 62C.11.1 is organized as follows:

                 (1) Scope of Regulation; Background; Outline of Topics; Effective Date.
                 (2) Definitions.
                 (3) Return Due Dates.           

         (d)    Effective Date.  830 CMR 62C.11.1 is effective for returns due on or after January 1, 2018.

(2) Definitions

For the purposes of 830 CMR 62C.11.1, the following terms have the following meanings:

Business Corporation. A business corporation as defined in M.G.L. c. 63, § 30.

Combined Group. A combined group as defined in 830 CMR 63.32B.2.

Combined Report. A combined report as defined in 830 CMR 63.32B.2.

Principal Reporting Corporation. A principal reporting corporation as defined in 830 CMR 63.32B.2.

S Corporation. An entity described at Internal Revenue Code § 1361, as amended and in effect for the taxable year.

(3) Return Due Dates

            (a)  Extended Due Date. A business corporation that is not an S corporation is generally required to file a corporate excise return on or before the 15th day of the fourth month following the close of its taxable year. M.G.L. c. 62C, § 11. When one or more such corporations is included in a combined group, the filing requirement for such corporations will be met when the combined report is filed by the group’s principal reporting corporation on or before the 15th day of the fourth month following the close of the combined group’s taxable year. When an S corporation is also included in such group there will be a discrepancy in the return due dates of the taxable group members even when the entities all share the same taxable year. Therefore, notwithstanding the provisions of M.G.L. c. 62C, § 11, ¶ 1, an S corporation that is a taxable member of a combined group may file its corporate excise return on or before the 15th day of the fourth month following the close of the combined group’s taxable year. Further, this extended due date applies irrespective as to whether the S corporation is the principal reporting corporation of the combined group or whether the combined group consists solely of S corporations. This extended due date also applies to the reporting of the S corporation’s non-income measure as required in the context of a combined report filing when the S corporation’s taxable year is the same as that of the combined group.

            (b)  
Application of Rule.  The extended due date applicable under 830 CMR 62C.11.1(3)(a) to the return of an S corporation that is a member of a combined group will generally apply for purposes of determining the due date of such an S corporation’s return under other applicable provisions of M.G.L. c. 62C, such as for purposes of imposing interest and penalties under M.G.L. c. 62C, § 32 and § 33. The extended due date in 830 CMR 62C.11.1(3)(a) will not apply to the due date of (1) the corporate excise return of an S corporation when that corporation is not a member of a combined group; (2) the corporate excise return of an S corporation reporting the non-income measure of the corporate excise when that S corporation’s taxable year is not the same as that of the combined group; and (3) the informational return of an S corporation, Form 355S, including Schedules S and SK-1. Such returns remain due on or before the 15th day of the third month following the close of an S corporation’s taxable year.


REGULATORY AUTHORITY
830 CMR 62C.11.1:  M.G.L. c. 14, § 6(1); M.G.L. c. 62C, § 3.

Date of Promulgation:  3/23/18

 

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