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Corporate Tax Forms
Since I have always been a big fan of using tax years other than January through December for corporations, I have long encountered confusion with clients who see what they think is the wrong year on their tax forms. That’s to be expected; but with someone whose official job is to review tax returns for a bank’s lending department, that’s a little scary.
Q:
Kerry ,I need to know if the last tax return you did for me is for the year 2004 or 2005 on my business. The bank is wanting a copy of 2005 and I took them the last one you sent me back in September, but they said it was for 2004 . If it is for 2005 I guess I'm ready for 2006. I also need to know if you have anything showing my federal I.D. number . I know i should have a certificate of some sort, but all I have is what the bank filed which is a {Corporate Authorization Resolution }.Thank You ,
A:
I pulled your files and confirmed that we are actually completely up to date with both your personal and corporate income tax returns.
It sounds like your banker is inexperienced with how corporation taxes work. They are required by IRS to use the forms for the year in which the corp tax year starts. In your case, the year going from 12/1/04 through 11/30/05 is reported on tax forms designated as 2004. If you look at the top of the first page of the 1120, you will see that it shows the tax year as 12/01/2004 through 11/30/2005.
After the current year is over (after 11/30/06), we will be able to do the corporation return on 2005 forms. In other words, you already have the most current corporate tax returns possible.
The same thing goes for your 2006 individual income tax returns. We can't work on those until after your personal tax year ends, 12/31/06.
Your corporate Federal ID number is on every page of the corporate tax returns.
I hope this clears things up for you. It sounds as if your bank needs to give its loan officers better training.
Let me know if you need anything else.
Kerry
- posted by Kerry M. Kerstetter, MBA~CPA~ATP~ATA @ 12/03/2006 07:07:00 PM Send this post:
