When a tax return is prepared, the income, expenses, deductions and credits for a particular period are used to calculate each item that is reported on the return. The dates within the period are dependent on whether a personal or business return is being prepared. Individual returns cover a regular calendar year, which businesses also use by default. However, business entities also may choose an alternate type of tax year, which results in coverage of different dates in the reporting period.
A calendar year tax period runs between Jan. 1 and Dec. 31 each year, the same dates as a regular calendar. Individuals use the calendar-year period. Many businesses also use the calendar-year period because it is familiar, and therefore simpler to account for. Businesses also may elect to use other tax-year periods, but must use the calendar year when it does not keep books or records, does not use an annual reporting method, or is not permitted by the IRS to use a reporting method other than the calendar year.
A fiscal year reporting period covers any annual period that ends on any day of the year other than Dec 31. For example, an accounting period that begins on Feb. 1 and ends on Jan. 30 the following year is a fiscal-year reporting period. By default, companies use the calendar-year method. However, an election may be made on the first return filed by the business to adopt a fiscal-year period. The business notes the fiscal dates used on the first return and must use the same dates each year following. If the business wishes to elect a different fiscal year, or to adopt a calendar year, it must file a request with the IRS on Form 1128 to change its accounting period.
52-53 Tax Year
A 52-53 tax year covers a period that always ends on the same day of the week each year, which may not necessarily be on the same date each year. This means the physical dates covered during the tax year may vary. For example, a business may elect a 52-53 tax year that ends on the last Friday of September. This reporting period is not often chosen by businesses because date variances can cause record-keeping and record-researching issues, especially if accounting duties are handled by different employees or service providers.
Tax returns are due based upon when a tax year ends. For individuals, your tax return is due on the 15th day of the fourth month following the end of tax year, or April 15. This date is also the due date for business owners who operate a sole proprietorship or single-member limited liability company that has not made an election to be taxed as a corporation. These business entities report on Schedule C, which is an attachment to the individual 1040 tax return. Partnerships also must file a return on the 15th day of the fourth month following the end of tax year, and corporations must file on the 15th day of the third month following the end of the tax year. When a calendar year period is used by partnerships or corporations, the due date for returns is April 15 or March 15, respectively. An additional six months to file may be granted if an individual or business requests an extension on or before the due date of the return.
- IRS: Publication 538 - Accounting Periods and Methods
- IRS: Form 1040 - When and Where Should You File?
- IRS: Instructions for Form 1065 - When to File
- IRS: Instructions for Form 1120 - When to File
- Internal Revenue Service. "Topic No. 301: When, How, and Where to File." Accessed Jan. 27, 2020.
- Internal Revenue Service. "Tax Years." Accessed Jan. 27, 2020.
- Virginia Department of Taxation. "Individual Income Tax Filing Due Dates." Accessed Jan. 27, 2020.
- New Hampshire Department of Revenue. "Taxpayer Assistance: Overview of New Hampshire Taxes." Accessed Jan. 27, 2020.
- New Hampshire Statutes: "Title V: Taxation. Section 76.2: Property Tax Year." Accessed Jan. 27, 2020.
- Internal Revenue Service. "Publication 538: Accounting Periods and Methods," Page 4. Accessed Jan. 27, 2020.
- Internal Revenue Service. "Publication 538: Accounting Periods and Methods," Pages 3-4. Accessed Jan. 27, 2020.
- Library of Congress. "History of the US Income Tax." Accessed Jan. 28, 2020.
- Commissioner of Internal Revenue. "Annual Report for the Fiscal Year Ended June 30, 1955," Page 9. Accessed Jan. 28, 2020.
- Internal Revenue Service. "Historical Highlights of the IRS." Accessed Jan. 28, 2020.
With a background in taxation and financial consulting, Alia Nikolakopulos has over a decade of experience resolving tax and finance issues. She is an IRS Enrolled Agent and has been a writer for these topics since 2010. Nikolakopulos is pursuing Bachelor of Science in accounting at the Metropolitan State University of Denver.