My corporation didn’t have any revenues last year – do I still need to file a tax return?
Posted on October 29, 2008 by admin
vajahar555 asked:
I bought a corporation from Wisconsin and I live in Delaware. I fI do need to file a return, then how many – federal and/or DE and /or WI?
I bought a corporation from Wisconsin and I live in Delaware. I fI do need to file a return, then how many – federal and/or DE and /or WI?
Did your corporation have any expenses? If there is a net taxable loss, the net taxable loss can be carried forward for 20 years (or back 2 years) to offset net taxable income. So, in this case, you should file to take advantage of the net operating loss (NOL) carryover (or carryback).
For sure your corporation will need to file in Wisconsin (if the corp. is incoporated there). Whether your corp. needs to file in other states will depend on what is called “nexus” (presence in a state). Usually, if a corp. has either employee or property (ie: office) in a state, there is enough “nexus” for income tax return filing. Also, sales into a particular state may create “nexus” but it is a complicated matter as there are many court cases about this issue.
You MUST file corporate tax returns EVERY year that the corporation is in existence, regardless of any income or loss.
Many states have minimum franchise fees or taxes that are due even if the corporation has no income. And some states have additional reporting requirements above and beyond tax returns. These must also be complied with.
There are stiff penalties for failure to file any required tax returns or other reports.
Your corporation probably does have to file.