Form 7004 must be filed by midnight local time on the normal due date of the return. In the case of a 1041, this is by the 15th day of the 4th month after the end of the tax year for the return. An accepted Form 7004 provides a 5.5-month extension of time to file the return. See Drake Tax – Return Due Dates and Deadlines for more information about the due date of Form 7004 and perfection period if the extension request is rejected.

Generate and File Form 7004

1. Open the return.

2. Enter demographic information on screen 1.

3. Open the EXT screen.

4. Select the option Generate an extension.

5. Enter the financial and other data required by the 7004. Tentative total tax and total payments and credits carry to the 7004 from the return if that data is available. If that data does not carry, or if you want to override the amounts on lines 6 or 7 of the 7004, use the overrides for those lines. Amounts must appear on those lines for a balance due to be present on the 7004, which is necessary if you intend to make a payment with the extension.

6. If including a payment, complete the PMT screen: 

   • Choose Yes for federal.

   • Enter the banking information and select the 7004 option.

   • This will create a PAYMENT worksheet in view. Also see the Transaction Summary.

7. On the EF Selections screen be sure to select the option 7004 only. Under State E-file Override check the box Do NOT send any states (unless you intend to send a state return or extension).

8. View the return and clear any ETD_MSG page errors.

   • Only those messages on the ETD_MSG page must be cleared to transmit the extension by itself. These messages are related to the extension not the actual return, and must be cleared before it can be transmitted.

   • Any regular MESSAGES page refers to the return itself and may be produced because the return is not finished. These will not prevent the extension from being eligible for e-filing.

   • You may see a MESSAGES page (EF Message 0147 or 0148) stating that the extension has been previously e-filed and accepted by the IRS, and that only the extension will be prevented from e-filing.

9. View the 1041EF page to confirm that Form 7004 will be transmitted.

10. e-File the extension form using the EF menu.

Ready to File the Regular Return

There is no need to delete the 7004 screen when you are ready to file the regular return. If you have filed a 7004 for a 1041 return and now want to send the regular return, complete the following steps:

1. Complete the return.

2. to the 7004 screen and select the option Extension was previously filed; regular return now ready for filing.

3. If a payment was made with the extension, enter the payment in the Amount paid with extension field on the 7004 screen.

4. On the EF Selections screen select the 1120-S to e-file instead of the 7004.

5. Check the view mode for any red message pages regarding the return.

6. Select the return for e-file and transmit.