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Inkle Refcheck

Refcheck sheet displaying all the global companies with us

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Inkle Onboarding Guide

Onboarding guide for companies moving for US tax, compliance and accounting to Inkle

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Inkle TP Payments

Group intercompany transfer pricing, royalty and investment payment module

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BYOB Subscription

Founders: Bring Your Own Bookkeeper!! Companies pay for the software and own the data.

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When is the deadline to file Form 7004 for C Corporations?

C Corporations must file Form 7004 on or before the original deadline of their tax return Form 1120, which is by the 15th day of the 4th month after the taxable year ends.

The deadline for C-Corporations following the calendar tax year is April 18, 2023.

What are the penalties for filing Form 7004 Late?

Suppose you fail to file a 7004 tax extension or tax return within the appropriate deadline (March 15, 2023, for S-corporations and partnerships and April 18, 2023, for corporations and other businesses). In that case, the IRS will charge interest and penalties on any unpaid Federal taxes.

If you do not file and owe taxes, the failure-to-file penalty is 5% per month (up to 5 months) of the amount due. If your return is over 60 days late, you may be subject to a $135 minimum penalty. The IRS will also impose a failure-to-pay penalty of 0.5% per month (up to 25%) of the amount due if you file a return or extension but don’t pay all your taxes on time.

Do I need monthly bookkeeping?

It's good practice (but not mandatory with Inkle).

In our experience, many founders tend to just "leave it to the deadline" - and then rush or miss the deadline. And they have little visibility into their books at any given time.

If you come to us days before the deadline, it's really tough for us to catch up your books if you have lots of transactions and missing invoices. And almost impossible to use Accrual method. So we'll be forced to used Cash method accounting, which isn't ideal for you.

Many US tax filing services compel you to pay a high monthly bookkeeping charge of more than $500/month and subscribe to Quickbooks, even if you have low activity at the start. We have fair pricing and nudge you for monthly bookkeeping because it's better for you, and it will cost you about half of the total monthly cost over 12 months in terms of annual cleanup anyway. Why not have monthly visibility instead.

Accrual Method or Cash Method?

Inkle strongly recommends Accrual Method (over Cash Method,) because:

- it's gives a much truer picture of your finances.

- prevents you from getting any nasty surprises.- it is easier for forecasting.

- it is GAAP-standard, and most VCs will ask for it.

- you will eventually have to do Accrual Method anyway after you cross $25mm in revenue (by law) or sooner, so why not start with it.

- the IRS does not permit you to switch to Accrual (from Cash) in the middle of a year.

- restating and translating prior years' Cash books into Accrual method would be a nightmare, if you want to compare later.

Cash Method is possibly OK if you have very little activity, or just started out or have no real revenue operations in US, but consult us for a discussion on this.

Because Accrual Method is more complex, we can only offer this to monthly customers. Trying to do Accrual Method once per year would just be too difficult for you and us, as we would have to discuss every transaction and invoice.

Do I need to file a State Filing?

It's best to do a tax consultation with our certified professional tax experts who can help you determine the answer.

As a general rule of thumb: if you don't have a formal physical office, permanent employees in attendance, stock or inventory and business operations, then you won't need to file a State return. This is even if your US company address is located in that state. Basically: it depends on what you're doing in the state.

How do I update the IRS with my company address

Just put your new address on your new Tax Filing, and they'll update their systems. Or see here for other methods: https://www.irs.gov/faqs/irs-procedures/address-changes/address-changes