Once you register with the Secretary of State’s Office and/or Department of Revenue, your business will likely need to submit franchise tax or foreign entity tax filings. Many businesses employ a Certified Public Accountant, tax attorney, or other professional to prepare and submit these filings. Often, this means paying more in preparer fees than the tax amount owed.
While we can’t stop the tax man, ReSource Pro Compliance makes the process a lot easier and more affordable. Our corporate compliance experts prepare and file your foreign entity zero income or minimum state tax returns for you. This allows your CPA to focus on more the complex domicile and/or resident state and federal returns.
When to File
Whether and when you need to file depends on numerous factors. Your corporate structure is the key factor, of course. Limited Liability Companies (LLCs) and C and S Corporations commonly need to file, but other types may have their own requirements. Many states also have different deadlines for businesses that use the calendar year versus a fiscal year. Important filing due dates for calendar year filers begin as early as March 15th and extend through April 15th. Fiscal year filing deadlines vary even more widely. Some states also allow filing extensions for qualified taxpayers, which further complicates your tax filing calendar.
Failure to comply with the different states’ filing deadlines can result in fines, tax penalties and even revocation of your authorization to do business in that state. Some jurisdictions assess penalties for each day a filing is late. It doesn’t take long to rack up fines in the thousands of dollars – far more than the actual tax due.
Robust Tax Filings Compliance
Our corporate compliance team keeps your tax filings calendar for you. Regulatory offices frequently change their requirements and update their forms. This can make it difficult to understand your compliance obligations, especially if you deal with a certain state only once or twice a year. Our long-standing relationship with regulators means our knowledge base updates continuously as we process tax filings for hundreds of different clients every month.
If you’ve missed any tax filings in the past, a compliance review with the state Departments of Revenue will find these gaps. Our experts use the appropriate tax rates and forms for the year in question and submit them with the required financial statements. We may even be able to negotiate the reduction of any penalty fees and fines.
Having an open account with the Department of Revenue for even one day of the tax year can trigger the need to file tax forms. This is true even if you’re not actively doing business in a state – even if you don’t hold a current insurance license there!
If you are downsizing or closing your insurance business, our corporate compliance experts ensure that your tax accounts are closed properly. We notify the appropriate state regulators that you no longer require an account, verify that all filings are up to date, and obtain letters of tax clearance as required.