The Treasury Department and the Internal Revenue Service are providing special tax filing and payment relief to individuals and businesses in response to the COVID-19 Outbreak. The filing deadline for tax returns has been extended from April 15 to July 15, 2020. The IRS urges taxpayers who are owed a refund to file as quickly as possible. For those who can’t file by the July 15, 2020 deadline, the IRS reminds individual taxpayers that everyone is eligible to request an extension to file their return.
Here are a few key takeaways.
- The extension applies to those taxpayers with a federal income tax filings and payment due April 15, 2020.
- The extension applies to an Affected Taxpayer’s tax due at April 15, 2020.
- The Applicable Postponed Payment Amount includes the payment of 2019 tax due and the 2020 first-quarter estimate payment (Both due at April 15, 2020).
- There is no limitation on the amount of the payment that may be postponed.
- The extension of time is automatic and does not require any additional filings.
- The term taxpayer is for individuals, trust, estates, partnership, association, company or corporation.
- This payment extension does not cover the 2020 second quarter estimate due June 15, 2020. This extension only applies to federal income tax and not to other types of taxes such as payroll, estate, and gift tax. At this time, most state or other district tax returns or payments are not addressed, although this is being considered.
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This filing and payment relief include:
The 2019 income tax filing and payment deadlines for all taxpayers who file and pay their Federal income taxes on April 15, 2020, are automatically extended until July 15, 2020. This relief applies to all individual returns, trusts, and corporations. This relief is automatic, taxpayers do not need to file any additional forms or call the IRS to qualify.
This relief also includes estimated tax payments for tax year 2020 that are due on April 15, 2020.
Penalties and interest will begin to accrue on any remaining unpaid balances as of July 16, 2020. You will automatically avoid interest and penalties on the taxes paid by July 15.
Individual taxpayers who need additional time to file beyond the July 15 deadline can request a filing extension by filing Form 4868 through their tax professional, tax software or using the Free File link on IRS.gov. Businesses who need additional time must file Form 7004.
State tax returns:
This relief only applies to federal income returns and tax (including tax on self-employment income) payments otherwise due April 15, 2020, not state tax payments or deposits or payments of any other type of federal tax. Taxpayers also will need to file income tax returns in 42 states plus the District of Columbia. State filing and payment deadlines vary and are not always the same as the federal filing deadline. The IRS urges taxpayers to check with their state tax agencies for those details. More information is available at https://www.taxadmin.org/state-tax-agencies.
We will continue to bring you details and information and assist you and your business in navigating these changes. If you have any questions about this extension, please contact us.
Pierce Firm, PLLC