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What is the late filing penalty for S Corp?

For an S-Corporation, if the income tax return is filed late with no tax due, the late filing penalty is $220 per month (or any portion of a month) the return is late, multiplied by the number of shareholders in the business.

If the S-Corp owes any taxes, an additional 5% penalty is imposed on the unpaid tax for each month or portion of a month the return remains unfiled.

The penalty for late filing applies regardless of whether the business has made a profit or incurred a loss. The late filing penalty still applies even if the business doesn't owe any tax.

To avoid these penalties, file Form 7004 on or before the return's original due date to get an extension of up to 6 months.