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What is Form 720?
Form 720 is used by taxpayers to
report liability by IRS number and to pay the excise taxes listed on the form.
This form is dedicated to businesses subject to excise taxes on goods and
services, and the IRS requires one to be filed every quarter, covering three
months. There are three major divisions for the filers: Schedule A, Schedule T,
and Schedule C. Additionally, there is a payment voucher (Form 720-V).
Does my
business need to file form 720?
If you have doubts about whether your business is required to file IRS Form 720, here is some clarity for you. Decide in less than a minute by considering the below pointers. If your business sells goods or services that are subject to excise taxes, you should file this form.
What is Excise Tax?
Excise tax is a federal tax imposed on
the production, import, sale, or consumption of specific commodities or
services. Goods subject to excise taxes can be produced in the U.S. or imported
from other countries.
- The list of products includes
telephone communications, air transportation, gasoline, coal, fishing
equipment, indoor tanning services, etc.
- You can check out the comprehensive list of all excise
taxes here.
- Some products are exceptions and are
not included in Form 720. These include alcohol, tobacco, firearms, etc., which
have separate acts for filing.
When to File Form 720?
For a year, this must be filed for
each quarter, that is, April 30, July 31, October 31, and January 31. If the
month-end date falls on a Saturday, Sunday, or legal holiday, then the form 720 due
date moves to the next business date. For more clarity on the dates and
months, please refer to the table below.
|
QUARTER |
MONTH |
DUE DATE |
|
1st quarter |
January, February, March |
Apr-30 |
|
2nd quarter |
April, May, June |
Jul-31 |
|
3rd quarter |
July, August, September |
Oct-31 |
|
4th quarter |
October, November, December |
Jan-31 |
WRAP:
Though understanding excise tax and liabilities is difficult, we hope our inputs have helped you decide whether your business needs to file Form 720 and when to do so. If you fall under the category of businesses required to file Form 720, we recommend you do it with eFile720 – The IRS Authorized eFile provider.