Form BA-403 Extension Vermont Corporate Income Tax

Form BA-403 Vermont Corporate Filing Extension.
Instructions for Form BI-471, Vermont Business Tax Return

From page1, paragraph 8, "Who must file"
"Effective for tax years beginning on or after January 1, 1997, every Subchapter S Corporation, Partnership and Limited Liability Company which engages in activities in Vermont must file a return
with the Commissioner of Taxes. This includes entities receiving income as a shareholder, partner or member."

From page 2, paragraph 3, "The pass‑through entity is liable for the minimum annual (entity) tax of  $250 for each taxable year beginning on or after January 1, 1998."

Vermont State Income Tax, Nolo
"The business entity tax applies to S corporations, LLCs, and partnerships. These types of business entities must pay a flat annual tax of $250."
- "S Corporations. An S corporation is created by first forming a traditional corporation, and then filing a special form with the IRS to elect “S” status; unlike a traditional corporation, an S corporation generally is not subject to separate federal income tax. Rather, taxable income from an S corporation is passed through to the individual shareholders, and each individual shareholder is subject to federal tax on his or her share of the corporation’s income; in other words, S corporations are “pass-through” entities. (Note that a shareholder’s share of the S corporation’s income need not actually be distributed to the shareholder in order for the shareholder to owe tax on that amount.) Vermont recognizes the federal S election; however, Vermont S corporations are required to pay the state’s business entity tax. In addition, an individual S corporation shareholder will owe tax on his or her share of the company’s income.
Example: For the 2012 tax year, your S corporation had net income of $500,000. The corporation will owe the $250 business entity tax. In addition, the corporation’s net income will be allocated among the various shareholders and each shareholder will pay tax on his or her portion on his or her individual state tax return; the rate will vary depending on the shareholder’s overall taxable income for the year."

Multistate Tax Considerations for S Corporations, Journal of Accountancy
- "Multistate S corporations are allowed to apportion their income to the states with which they have nexus. For many years, most states followed an evenly weighted three-factor apportionment by sales, tangible property and payroll in each state."
- " Composite returns. Many states allow multistate S corporations to file a composite tax return on behalf of all shareholders of the S corporation. With it, the income of each shareholder is reported to the state, and the S corporation pays the tax on behalf of the shareholder. The advantage is that shareholders do not have to file individual income tax returns for that income with any state where the S corporation filed a composite tax return. The states that do not accept composite tax returns include Nebraska, Oklahoma, Tennessee and Utah (although Utah did issue a private letter ruling (02-033) in 2003 allowing a composite return for nonresident shareholders in an electing small business trust). Some states, including Arizona, New York and Vermont, restrict the use of composite returns, based on income or number of shareholders."

Required Entries
Indicate Federal Tax Return > 1120S for S-Corp
Begin date 1/1 to 12/31 of previous year
Calculation of Tax Due, 1. $250, 2. $0, 3. $250 because S-Corp is pass through entity