120/165 EXT — Application for Automatic Extension (Corp, Partnership, Exempt Org) (2025 instructions)

# preamble

2025 Application for Automatic Extension of Time to File Arizona Form Corporation, Partnership, and Exempt Organization Returns 120/165 EXT

Phoenix (602) 255-3381

If you need tax forms, instructions, and other tax information, go to the department's website at www.azdor.gov.

Income Tax Procedures and Rulings These instructions may refer to the department's income tax procedures and rulings for more information. To view or print these, go to our website and select Reports & Legal Research. On the next page, click on Legal Research. Select a Document Type and a Category from the drop down menus. If you know the document ID number you may enter it in the Search field and then press enter.

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# General Instructions

Use of Form

• Use Arizona Form 120/165EXT to apply for an extension of time to file Forms 120, 120A, 120S, 99T, 99M, or 165. Do NOT use Arizona Form 120/165EXT to apply for an extension of time to file any other tax return.

• Nonprofit medical marijuana dispensary organized or taxed as an S Corporation: File one Arizona Form 120/165EXT to apply for an Arizona extension to file Arizona Form 99M. File a second Arizona Form 120/165EXT to apply for an Arizona extension of time to file Arizona Form 120S. A valid federal extension may be used to file Arizona Form 120S but cannot be used to file Arizona Form 99M. No extension payment is due.

• Nonprofit medical marijuana dispensary organized or taxed as a partnership : File one Arizona Form 120/165EXT to apply for an Arizona extension to file Arizona Form 99M. File a second Arizona Form 120/165EXT to apply for an Arizona extension of time to file Arizona Form 165. A valid federal extension may be used to file Arizona Form 165 but cannot be used to file Arizona Form 99M.

• Arizona Form 120S and Arizona Form 165 filers : Use Arizona Form 204 to apply for an extension of time to file a composite return on Arizona Form 140NR for nonresident individual shareholders or nonresident individual partners.

• The department may grant an automatic Arizona extension if: o the taxpayer pays at least 90 % of the tax liability by the original due date of the return; and o Arizona Form 120/165EXT is postmarked or received by the original due date of the return. The extension application will be denied if the extension application is postmarked after the original due date of the return. A copy of Arizona Form 120/165EXT will be returned to the taxpayer only if the extension application is denied.

NOTE: The department may grant an extension request for a C corporation or an exempt organization for a maximum of seven (7) months from the original due date of the return.

The department may grant an extension request for an S Corporation or partnership for a maximum of six (6) months from the original due date of the return.

Payment of Tax, Penalties, and Interest

The Arizona extension and the federal extension provide an extension if time to file; they do not provide an extension of time to pay any tax liability. The entire amount of tax, penalties, and interest is due by the original due date of the return.

Payment by Electronic Funds Transfer

Taxpayers are required to pay their tax liability by electronic funds transfer (EFT) if the taxpayer owes $500 or more for any taxable year beginning from and after December 31, 2020.

A taxpayer may apply to the director for an annual waiver from the electronic payment requirement. The application must be received by December 31 of each year. The director may grant the waiver if any of the following applies: • The taxpayer has no computer. • The taxpayer has no internet access. • Any other circumstance considered to be worthy by the director exists, including: o The taxpayer has a sustained record of timely payments, and o The taxpayer has no delinquent tax account with the department.

To request a waiver, submit Arizona Form 292, Electronic Filing and Payment Waiver Application , to the department. Arizona Form 292 is available at: https://azdor.gov/forms/other -forms/electronic -filing - and -payment -waiver -application .

NOTE: A taxpayer who is required to pay by EFT but who fails to do so is subject to a penalty of 5% of the amount of the payment not made by EFT. See A.R.S. § 42-1125(O).

For additional information on EFT, refer to A.R.S. § 42-1129 and the related Arizona Administrative Code rules (A.A.C. R15-10-301 through R15-10-307) for detailed information.

How to Make EFT Payments

Taxpayers1 making an EFT payment from a checking or savings account or by credit card are no longer required to register with the department prior to making EFT payments. Visit AZTaxes.gov, click "Make a Corporation/S Corporation/Partnership Payment" and follow the prompts.

• Electronic payment from checking or savings account/ e-check/ACH Debit.

1 As used in this section, "Taxpayers" refers to Corporations, Exempt Organizations with UBTI, S Corporations subject to tax at the federal level or that make the PTE election to pay Arizona income tax at the entity level, and Partnerships that make the PTE election to pay Arizona income tax at the entity level.

Payments can be made electronically from a checking or savings account. Go to www.AZTaxes.gov, click "Make a Corporation/S Corporation/Partnership Payment", follow the prompts, and choose the e -check option. Follow the prompts to make your payment.

There is no fee to use this method. This payment method will debit the amount from the specified checking or savings account on the date specified. When an electronic payment is made from a checking or savings account, a confirmation number will be generated. Please keep this confirmation number as proof of payment.

• Online credit card payment

Payments can be made by American Express, Discover, MasterCard, or Visa credit cards. Go to www.AZTaxes.gov, click "Make a Corporation/ S Corporation/Partnership Payment", follow the prompts, and choose the credit card option. This will take you to the website of the credit card payment service provider. Follow the prompts to make your payment.

The service provider will charge a fee based on the amount of the tax payment. The service provider will disclose the amount of the fee during the transaction and you will be given the option to continue or cancel. If you accept the fee and complete the credit card transaction, a confirmation number will be generated. Please keep this confirmation number as proof of payment.

• Taxpayers may also make EFT payment by ACH Credit. Corporations wishing to pay by ACH credit must register with the department before their ACH payment will be accepted.

To register to make ACH Credit payments, complete Arizona Form number 10366, Electronic Funds Transfer (EFT) Disclosure Agreement for ACH Credit filers, available here: https://azdor.gov/forms/other -forms/electronic -fundstransfer -eft-disclosure -agreement -ach-credit-filers. Complete the form as instructed. Submit the completed form at least ten business days before the first anticipated transaction as it may take that long to process the application. Fax the completed form to the department at (602) 771-9913. You may also email the completed form to the department at: electronicfundstransfer@azdor.gov. If you have not received your approval within one week, you may direct follow-up inquiries to: electronicfundstransfer@azdor.gov. Once the application is processed, you will receive additional information to present to your bank to make the ACH Credit payment.

The corporation's tax payment will be electronically transferred into the department's account, normally the next business day. Consult with your bank for the timeframe required to make timely payments. You may be charged a service fee.

NOTE: Taxpayers using a foreign bank account to make EFT payments cannot make EFT payments by ACH Debit. The department does not accept ACH Debit payments from a foreign bank account. If the taxpayer wishes to make payment from a foreign bank account by EFT, the payment MUST be made by ACH Credit. See the instructions for ACH Credit above to register and make ACH Credit payments.

Acceptance of Federal Extension

NOTE: Federal extensions extend an original Arizona due date by the same period of time covered by the Arizona extension.

Generally, the taxpayer can use a valid federal extension rather than applying for an Arizona extension. The taxpayer must pay at least 90% of the tax liability by the original due date of the return. Refer to the instructions for line 1 (extension payment computation) for further information on the payment amount.

A taxpayer whose tax liability for the 2025 taxable year was greater than $500 that uses a federal extension of time to file must make its 2025 extension payment by EFT. See the Section Payment of Tax Liability by Electronic Funds Transfer on page 1 for details on making tax payments by EFT.

A taxpayer whose tax liability for the 2025 taxable year was less than $ 500 that uses a federal extension of time to file may use Arizona Form 120/165EXT to remit an extension payment via check or money order. Or it may elect to participate in EFT. Mail Arizona Form 120/165EXT and the extension payment to the payment address shown on the form.

Tax Return Original Due Dates

Arizona Form 99M: 15th day of the fifth month following close of taxable year.

Arizona Form 99T: 15th day of the fifth month following close of taxable year.

Arizona Form 120: 15th day of the fourth month following close of taxable year.

Arizona Form 120A: 15th day of the fourth month following close of taxable year.

Arizona Form 120S: 15th day of the third month following close of taxable year.

Arizona Form 165: 15th day of the third month following close of taxable year.

Penalties and Interest

A. Late Filing Penalty

Without a valid federal or Arizona extension, a return filed after the original due date is subject to the late filing penalty. A return filed after its extended due date is also subject to the late filing penalty. The late filing penalty is 4 .5% (.045) of the amount of tax required to be shown on the return. The penalty period is each month or fraction of a month between the due date of the return and the date the taxpayer filed the return. The maximum penalty is 25 % of the tax found to be remaining due.

B. Extension Underpayment Penalty

The taxpayer must pay at least 90% of the tax liability reported on its return by the original due date of the return. If it does not, the extension underpayment penalty is charged on any late or underpaid extension payments. The extension underpayment penalty is 0.5% (.005) of the tax not paid for each 30 -day period or fraction of a 30- day between the original due date and the date the tax is paid. The maximum penalty is 25 % of the unpaid tax. Taxpayers subject to the extension underpayment penalty are not subject to the late payment penalty described in C below.

C. Late Payment Penalty

The late payment penalty is charged on any amount shown as tax on a return that is not paid by the due date. The late payment penalty is 0.5% (.005) of the unpaid tax for each month or fraction of a month that the tax remains unpaid, not to exceed 10% of the unpaid tax.

NOTE: If more than one of the penalties described in A, B, or C apply, the maximum combined penalty is 25%.

Refer to the department's ruling, CTR 09-1, When do Penalties Apply to an Income Tax Return Filed Under an Extension, regarding the application of penalties to returns filed under extension.

D. Information Return Penalty

An information return that is incomplete or filed after its due date (including extensions) is subject to a $100 penalty for each month or fraction of a month that the failure continues, up to a maximum penalty of $500. This applies to Arizona Form 99M. It also applies to Arizona Form 120S 2 and Arizona Form 1653 when no tax liability is due.

E. Interest

The department charges interest on any portion of the tax not paid by the due date. The department compounds interest annually and applies it in the same manner and at the same time as the IRS. The Arizona rate of interest for both underpayments and overpayments for all taxpayers is the federal underpayment rate.

On January 1 of each year, the department adds any interest outstanding as of that date to the principal amount of the tax. It is then a part of the principal amount of the tax and accrues interest until paid.

Rounding Dollar Amounts

Taxpayers must round amounts to the nearest whole dollar. If 50 cents or more, round up to the next dollar. If less than 50 cents, round down.

# Specific Instructions

Calendar year filers, check the box "calendar year 2025 ". Fiscal year filers, check the box, "fiscal year" and enter the beginning and ending dates for the fiscal year. If this is a

2 When the S Corporation is subject to tax at the federal level and/or when the S Corporation makes the PTE election to pay Arizona income tax at the entity level. 3 When the partnership makes the PTE election to pay Arizona income tax at the entity level. short-period return, indicate the beginning and ending dates of the short-period. Check the box if this return is based on a 52/53 week taxable year.

Type or print the required information in the name, address, and information boxes on the top of page 1. Include the Business Telephone Number (with area code), and the Business Activity (NAICS) Code from the corporation's federal return.

If the taxpayer has a foreign address, enter the information in the following order: city, province or state, and country. Follow the country's practice for entering the postal code. Do not abbreviate the country's name.

All returns, statements, and other documents filed with the department require the taxpayer's employer identification number (EIN), or taxpayer identification number, (TIN). Taxpayers that fail to include their TIN may be subject to a penalty.

Checkboxes

• Check box A if this is the first tax return filed under this name and EIN. • Check box B if the taxpayer name and/or address has changed. • Check box C, if the taxpayer's EIN has changed. Enter the previous EIN in the space provided.

Check the box to indicate the type of return the taxpayer will file: 120, 120A, 99T, 99M, 120S, or 165.

Check One Box

Arizona Form 120, Arizona Form 120A, Arizona Form 99T, or Arizona Form 99M

If you are requesting an Arizona extension for a C Corporation or an Exempt Organization, check the box indicating "Form 120, Form 120A, Form 99T or Form 99M". Enter the Extended Due Date (seven months after original due date) and the Taxable Year Ending in the corresponding columns.

Arizona Form 120S or Arizona Form 165

If you are requesting an Arizona extension for an S Corporation or a Partnership, check the box indicating "Form 120S or Form 165". Enter the Extended Due Date (six months after original due date) and the Taxable Year Ending in the corresponding columns.

Extension Payment Computation Taxpayers filing Form 120, 120A, 120S, 99T, or partnerships making the Pass-Through Entity election to pay tax at the entity level on Form 165 only.

NOTE: Refer to the tax form and its instructions for information regarding the computation of the tax liability (including the $50 minimum tax).

# Line 1

Arizona Form 120 filers

Begin the tax liability computation on page 1, line 16 of the 2025 Arizona Form 120. The amount entered on Arizona Form 120/165EXT, line 1 should equal the amount computed for the 2025 Arizona Form 120, page 1, line 21, less the amount computed for line 22. Reduce this amount by the

claim of right adjustments, if applicable. If the amount is less than zero, enter "0". Arizona Form 120A filers

Begin the tax liability computation on page 1, line 8 of the 2025 Arizona Form 120A. The amount entered on Arizona Form 120/165EXT, line 1 should equal the amount computed for the 2025 Arizona Form 120A, page 1, line 13, less the amount computed for line 14. Reduce this amount by the claim of right adjustments, if applicable. If the amount is less than zero, enter "0".

Arizona Form 120S filers

The S Corporation itself is subject to tax (including the $50 minimum tax) only if it has income or (loss) subject to tax at the corporate level on the federal Form 1120S. Income subject to tax is excess net passive income, capital gains, or certain built -in gains, reported on Arizona Form 120S, page 1, lines 2 and 3.

If the S Corporation elects to pay tax at the entity level on its flow-through income, complete page 2, Part 2, Calculation of S Corporation Tax to be Paid at the Entity Level of Form 120S.

Begin the tax liability computation on page 1, line 12 of the 2025 Arizona Form 120S. The amount entered on Arizona Form 120/165EXT, line 1 should equal the amount computed for the 2025 Arizona Form 120S, page 1, line 19 , less the amount computed for line 20. If the amount is less than zero, enter "0".

Arizona Form 99T filers

Begin the tax liability computation on page 1, line 6 of the 2025 Arizona Form 99T. The amount entered on Arizona Form 120/165EXT, line 1 should equal the amount computed for the 2025 Arizona Form 99T, page 1, line 11, less the amount computed for line 12. If the amount is less than zero, enter "0".

Arizona Form 165 filers that elected to pay tax at the entity level

Begin the tax liability computation on page 2, line 8 of the 2025 Arizona Form 165. The amount entered on Arizona Form 120/165EXT, line 1 should equal the amount computed for the 2025 Arizona Form 165, page 2, line 23. If the amount is less than zero, enter "0".

# Line 4

If the extension payment is made electronically, enter the amount on line 4.

Taxpayers whose Arizona income tax liability for the 2025 taxable year was $500 or more must make 2025 Arizona income tax payments using EFT. See the Section, Payment of Tax Liability by Electronic Funds Transfer , on page 1 of these instructions, for options on paying the tax liability by EFT.

Taxpayers whose Arizona income tax liability for the 2025 taxable year was less than $500 may elect to pay by EFT. They may also pay by check or money order. Make the check or money order payable to Arizona Department of Revenue. Include the taxpayer's EIN on the front of the check or money order. If paying by check or money order, include the check or money order with Arizona Form 120/165EXT.

# Line 5

The taxpayer must pay at least 90 % of its tax liability by the original due date of the return. If the estimated tax payments reported on line 2 are less than 90 % of the amount on line 1, the taxpayer must make an extension payment. Enter the amount of payment enclosed with this extension on line 5.

Who May Sign Arizona Form 120/165EXT

The person authorized to sign Arizona Form 120/165EXT may be:

• All forms: a duly authorized agent holding a power of attorney; • Arizona Form 99T, 120, 120A, or 120S filers : a principal officer of the organization; • Arizona Form 165 filers: a general partner authorized to file the partnership return; • Arizona Form 99M filers: o Sole proprietorship - the individual who owns the business. o Corporation (including a limited liability company (LLC) treated as a corporation) - a principal officer of the corporation. o Partnership (including an LLC treated as a partner - ship) or unincorporated organization - a general partner authorized to file the return. o Single member LLC treated as a disregarded entity for federal income tax purposes - the owner of the LLC or a principal officer authorized to sign. o Trust or estate - the fiduciary.

Mailing Arizona Extension Requests

If you are including a payment with the Arizona extension request, mail the request and payment to:

Arizona Department of Revenue PO Box 29085 Phoenix, AZ 85038-9085

If you are mailing the request without including a payment (because no payment is due or the payment was made electronically), mail the request to:

Arizona Department of Revenue PO Box 29079 Phoenix, AZ 85038-9079

The extension request must be postmarked by the original due date of the return. Mark "Extension Request" on the envelope. No copy will be returned to the taxpayer unless the request is denied. Keep a copy of Arizona Form 120/165EXT for the taxpayer's records.