March 30, 2022 3:24 am

Farmers and Fishermen Get Penalty Waiver

Usually, farmers and fishermen are only required to make one estimated tax payment if they are “qualified.” Being qualified means having two-thirds of gross income in the current or previous year from farming or fishing businesses. And no estimated tax payment is required if they file their returns and pay any tax due by March 1. Those who operate their farming or fishing businesses as an S corporation may need to file new Form 7203, S Corporation Shareholder Stock and Debt Basis Limitations, with their 2021 return. However, there were problems with third-party software companies in filing this form electronically by March 1, 2022. As a result, the IRS waived any penalties that would otherwise be due for not filing by March 1 as long as the return is filed by April 18, 2022 (April 19 for those in Maine or Massachusetts) (IR-2022-49).

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Tax Glossary

Cash method of accounting

Reporting income when actually or constructively received and deducting expenses when paid. Certain businesses may not use the cash method.

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