IRS Form 1120-S (2017): S Corporation Tax Return
What IRS Form 1120-S (2017) Is For
Form 1120-S is the U.S. Income Tax Return for an S Corporation. It must be filed by any domestic corporation or other entity that elected S corporation status using Form 2553 and received IRS approval (IRS Instructions for Form 1120-S (2017)). S corporations are pass-through entities, meaning income, losses, and credits flow to shareholders’ personal returns via Schedule K-1.
When You’d Use Form 1120-S for 2017 (Late or Amended Filing)
You’d need to file late if your corporation missed the March 15, 2018 deadline (or extended due date) and received IRS notices or penalties. Amended returns may be necessary to correct errors in income, deductions, or shareholder allocations on K-1s. While S corporations don’t generate refunds, corrections affect shareholders’ individual tax liabilities and possible refunds.
Key Rules Specific to 2017
- 2017 was the last year for the Section 199 domestic production deduction, repealed by the Tax Cuts and Jobs Act beginning in 2018.
- Late filing penalties increased to the smaller of the tax due or $210 for returns filed more than 60 days late.
- Entertainment expenses incurred after 2017 are no longer deductible, but this does not affect 2017 returns.
Step-by-Step (High Level)
- Gather records: Request 2017 account transcripts with Form 4506-T and collect all financial documents.
- Use the correct form: File the 2017 Form 1120-S, not current-year versions.
- Prepare schedules: Include Schedule K-1 for each shareholder and other required attachments.
- Calculate penalties: Apply late filing penalties as required.
- File and distribute: Submit to the IRS service center and provide K-1s to shareholders.
- Keep records: Retain copies of filed returns, K-1s, and proof of submission.
Common Mistakes and How to Avoid Them
- Leaving form lines blank with “See Attached” instead of completing properly.
- Missing or inaccurate Schedule K-1s for shareholders.
- Filing schedules out of order instead of following the instructions.
- Filing without verifying that the S election (Form 2553) was properly accepted.
- Incorrect preparer information if no paid preparer was used.
- Omitting required disclosures for foreign assets or reportable transactions.
What Happens After You File
IRS processing usually takes 6–8 weeks for paper returns. Expect penalties of $200 per shareholder per month (up to 12 months) if filed late. You may receive notices for missing information or assessed penalties. Payment plans are available via Form 9465 or online applications. If you disagree with penalties, you can appeal by providing reasonable cause documentation.
FAQs
How much is the late filing penalty for my 2017 S corporation return?
The penalty is $200 per shareholder for each month (or part of month) the return is late, up to 12 months. For returns more than 60 days late, a minimum penalty of $210 or the unpaid tax applies, whichever is smaller. These charges can add up quickly, especially for multi-shareholder corporations.
What if I never provided Schedule K-1s to my shareholders?
The IRS imposes penalties of $260 for each missing or incorrect K-1, rising to $530 if intentional. File the overdue 1120-S promptly and issue corrected K-1s to all shareholders. This ensures proper pass-through reporting and minimizes additional fines. Shareholders may also need to amend their individual returns if prior filings were affected.
Can I get transcripts for my 2017 S corporation return?
Yes. Use Form 4506-T to request business tax transcripts for up to 10 years. These transcripts reveal what the IRS has recorded, including filings, penalties, or payments. Reviewing transcripts before filing helps confirm compliance and prevents duplicate submissions. Access may take weeks depending on whether the request is electronic or mailed.
Is there still time to get a refund if I’m filing late?
No. Refund opportunities for 2017 returns have generally expired. S corporations themselves rarely get refunds, but if the business overpaid at the corporate level, the statute expired in March 2021. Shareholders may still claim adjustments individually if affected by amended K-1s, depending on their personal filing circumstances.
Should I also amend my state S corporation return?
Yes. Federal changes often affect state returns, and most states require amended filings. Deadlines and rules vary, but failure to amend state filings can lead to discrepancies, penalties, or audits. Always contact your state’s tax agency or check guidance to ensure state compliance when filing amended or late federal S corporation returns.
Can I e-file a late 2017 return?
Electronic filing options are limited for older returns. Many tax software providers no longer support 2017 electronic submissions, making paper filing the standard method. To ensure timely acceptance, mail the return to the IRS service center listed in the instructions and retain proof of mailing as part of your records.
What if my S election was never properly made?
If Form 2553 was not filed or approved, the corporation isn’t recognized as an S corporation for 2017. In that case, the business must generally file as a C corporation using Form 1120. However, late election relief may be available under IRS guidelines, depending on the facts and circumstances provided.
