If I e-file a business return or extension before the deadline, and the IRS rejects it after the deadline, what can I do then?
To correct a business return rejection that occurs after the due date of the return, where the initial e-filing was timely, you have two choices. During the perfection period, you can either correct the return and re-transmit it or you can paper-file the return. A taxpayer (a large business) who is required to e-file may need an e-file waiver to paper-file a corrected return (see Notes below).
What is the perfection period?
The perfection period is a 5 or 10 day period of time during which you can "perfect" a rejected e-filing. Generally, the perfection period begins when a return or extension is transmitted timely and may extend beyond the due date of the filing. The length of the period depends on what you have e-filed. Deadlines are midnight, but we recommend that you file as early as possible to ensure a timely filing:
|7004 and 8868 extension
|| 5 days
|1120, 1120S, 1065, 1041 and 990
| 10 days
Pub. 4163. Page 57 states that the IRS "looks back" 5 or 10 days from the date of an accepted e-filing, determines the date of the earliest rejection during that period and attributes the accepted e-filing to that date. Thus, if the earliest rejection during the period is timely, the accepted e-filing is considered timely. Note that "the perfection period is never extended regardless of weekends, holidays or the end of the year cutoff."
Note: DRKPARSE and Drake B-ack errors do not qualify for the perfection period.
To re-transmit a corrected business return or extension:
- Figure the perfection period from the last timely filing of the return or extension.
- Diagnose, correct and re-transmit that filing.
- You must re-transmit the corrected return within the perfection period.
- You can re-transmit more than once during the perfection period.
- Any retransmission after the end of the perfection period results in a late filing
To paper file a corrected business return or extension:
- A paper return must:
- Have an e-file waiver if the taxpayer is required to e-file. The taxpayer must call the IRS e-help Desk, 1-866-255-0654, to advise that they have not been able to have their return accepted. The e-help Desk will provide an e-Case number to the taxpayer.
- Be postmarked by the later of the due date of the return (including extensions) or 10 calendar days after the date the IRS last gives notification that the return is rejected.
- An explanation of why the return is being filed after the due date.
- A copy of the reject notification.
- A brief history of actions taken to correct the electronic filing.
- A note written in red at the top of the first page of the paper filing - REJECTED ELECTRONIC RETURN - (DATE). The date is the date of first reject within the perfection period.
- Be signed by the taxpayer.
- A paper extension must:
- Be postmarked by the later of the due date of the return, or 5 calendar days after the IRS last gives notification that the extension is rejected. A taxpayer who is required to e-file a return is not required to e-file an extension, and an e-file waiver is not necessary.
- An explanation of why the extension is being filed after the due date.
- A copy of the reject notification.
- The information in this article is extracted from IRS Pub. 4163, Modernized e-File (MeF) Information for Authorized IRS e-file Providers for Business Returns.
- Notice 2010-13 applies to taxpayers who are required to e-file - partnerships with 100 or more K1s, and some corporations, S corporations and tax-exempt organizations with assets of $10 million or more. "Notice 2010-13 provides that a taxpayer required to e-file can request a waiver from the electronic filing requirement when it cannot meet the electronic filing requirements. Before filing a paper return, corporations, partnerships and tax exempt organizations required to e-file must contact the e-help Desk (1-866-255-0654) to attempt to resolve the rejection conditions. If the rejection conditions cannot be resolved, these taxpayers must receive authorization from the e-help Desk before filing a paper return." (IRS Pub. 4163, p. 109)