How to File a Final Form 720

A final Form 720 return is the last quarterly return you expect to owe. You file one if you have been filing Form 720 and you either go out of business or won't owe any excise tax reportable on the form in future quarters. The return itself looks normal. The only difference is a checked box labeled "Final return" at the top of page 1.

The reason this box matters is the first line of the IRS "who must file" rule. Once you have been liable for a listed tax, you stay on the hook to file each quarter until you have filed a final return. Stopping the activity is not enough. If the return never says "final," the requirement to file stays open under that rule. If you want the wider picture first, the Form 720 overview explains how the return is organized.

When does a Form 720 count as your final return?

The instructions give two triggers. Either one is enough.

Both triggers look forward. The question is not whether this quarter was slow. The question is whether you expect any more Form 720 liability after it.

How to complete the last return, step by step

1. Enter the name, address, EIN, and the quarter ending date (month and year) as usual.
2. Check the "Final return" box above Part I. If your mailing address has also changed, check "Address change" too, so the IRS has somewhere to reach you after you close.
3. Report every tax for the quarter in Part I and Part II. A final return is still a real return, and all the tax up to your stopping point belongs on it.
4. If you have Part I tax, complete Schedule A. It records your net liability by semimonthly period, even when the total is under $2,500.
5. Work through Part III. Line 3 is your total tax, and line 5 is the deposits you made for the quarter.
6. Settle the difference. Pay any balance on line 10. If you overpaid, see the next section.
7. Have someone authorized by the entity sign and date it.

If you have nothing at all to report, the instructions say to enter "None" on Part III, line 3, then sign and date. Check the final box on that return if no more tax is coming.

What happens to an overpayment on a final return?

This is the choice people tend to miss. Line 11 lets you apply an overpayment to your next return or have it refunded. On a final return, there is no next return, so "Refunded to you" is the box that fits. The form then asks for a routing number, account type, and account number on lines 11c through 11e. The IRS says to use direct deposit for refunds if you have access to U.S. banking services.

Keep that bank account open until the money arrives. The instructions also warn that if you owe other federal tax, interest, or penalty, the overpayment is applied to those amounts first.

Why PCORI-only filers are in a different position

The patient-centered outcomes research fee, often called the PCORI fee (IRS No. 133), is annual. It goes on the second-quarter return only. If you file that return only to report the fee, the instructions say no filing is required in the other quarters unless you have other fees or taxes to report. You also shouldn't file a first-, third-, or fourth-quarter Form 720 just for this fee.

So a PCORI-only employer has no quarterly filing chain to end. Here is how the final return rule works out for that filer:

• Your self-insured plan continues. Don't mark the return final. You will report the fee again next year.
• Your plan ended, and this return reports the fee for its last plan year. You won't owe in future quarters, which matches the wording of the final return rule. The instructions don't discuss this exact case, so checking the box is our reading of the general rule rather than a specific IRS statement.
• You stopped a quarterly tax but still owe the PCORI fee. You will still have Form 720 liability next year, so the return where you stop the other tax doesn't meet the "won't owe in future quarters" test on its face. The IRS sources we reviewed don't address this mix directly. Ask a tax professional before relying on either reading.

Our PCORI fee guide covers the fee itself, including who owes it and how the rates work.

What checking the final box does not end

• Deposit duties for the quarter. If your Part I net liability for the quarter is over $2,500, semimonthly deposits still apply until your tax stops. Paying with the return instead of depositing as required may bring a penalty.
• Corrections to old quarters. Adjustments to liabilities reported for prior quarters go on Form 720-X, not on a Form 720. See our guide to the amended Form 720-X.
• Recordkeeping. Keep copies of returns, records, and transaction accounts for at least 4 years from the latest of the date the tax became due, the date you paid it, or the date you filed a claim.
• Personal exposure for collected taxes. Communications, air transportation, and indoor tanning taxes are collected from customers. If they were collected but not paid over, or willfully not collected, the trust fund recovery penalty may apply to responsible people, and it equals the full unpaid tax. Closing the business doesn't appear in the IRS text as an exception.

Filing your last return online

You make the decision about whether this is your last return, because only you know what the business will do next. Once you know, you can file your final Form 720 online with EasyFile720. The guided steps run from business details through to submission. You enter your figures, the rates and math are handled for you, and validations catch common mistakes before you submit. You sign electronically and get an electronic acknowledgment from the IRS once the return is accepted.

Creating an account is free, and you pay when you file. It's $39.95 per filing, and the pricing page has the details. If this really is your last return, the single filing is the option to look at, because a multi-filing plan is built for repeat filers. Your past returns stay saved in your account, which helps while you are holding on to records after you close. When your last quarter's figures are ready, the Form 720 online filing page shows how to start.

FAQ

Sources: Form 720 (Rev. June 2026); Instructions for Form 720 (Rev. June 2026); Pub. 510 (Rev. December 2025). General information, not tax advice. Confirm how the rules apply to you with a qualified advisor or the IRS.