IRS automatically extends April 15 income tax filing and related payments to July 15
As of March 20, 2020 tax payers will have until July 15, 2020, to both file and pay taxes.
On March 24, 2020, the IRS issued additional guidance relating to the postponement of certain income tax returns and income tax payments due on April 15, 2020. Key provisions of the IRS’s filing and payment deadline Q&A, the previously published IRS Notice 2020-18, and a March 20, 2020, Treasury update are summarized below, along with our insights.
- The Treasury postponed the due date from April 15, 2020, to July 15, 2020, to file all federal income tax returns and related tax payments for returns and taxes originally due April 15, 2020, irrespective of whether the return had an original or extended April 15, 2020, due date.
o Per Treasury Secretary Mnuchin, "We are moving Tax Day from April 15 to July 15. All taxpayers and businesses will have this additional time to file and make payments without interest or penalties."
- Those eligible for relief include “an individual, a trust, estate, partnership, association, company or corporation.” The specific return types eligible for postponement are as follows.
o Form 1040, 1040-SR, 1040-NR, 1040-NR-EZ, 1040-PR, 1040-SS
o Form 1041, 1041-N, 1041-QFT
o Form 1120, 1120-C, 1120-F, 1120-FSC, 1120-H, 1120-L, 1120-ND, 1120-PC, 1120-POL,
o 1120-REIT, 1120-RIC, 1120-SF
o Form 8960
o Form 8991
o “With respect to Form 990-T, if that Form is due to be filed on April 15, then it has been postponed to July 15” under Notice 2020-18, the Q&A says. “For taxpayers whose Form 990-T is due on May 15, that due date has not been postponed.”
- The filing of returns due on March 16, 2020, which include Form 1065, Form 1065-B, Form 1066, and Form 1120-S for calendar-year taxpayers, has not been postponed.
- Pursuant to Notice 2020-18, unlimited payment relief is provided for impacted taxpayers (i.e., the new Notice supersedes Notice 2020-17, which had limited relief to up to $1 million for individuals and $10 million for corporations).
- Impacted taxpayers need not file extensions of time to file, provided their returns are filed by July 15, 2020.
- Note that the deferral is for federal (not state) income tax payments, including self-employment taxes, for:
o The 2019 tax year
o 2020 estimated taxes due April 15, 2020
o A calendar-year S corporation’s first installment (typically for any estimated tax due relating to built-in-gains tax)
o Section 965 payments for any taxpayer whose Federal income tax return filing due date has been postponed from April 15 to July 15, 2020, where a Section 965 installment was due on April 15.
- Your 2020 Q2 estimate is still due June 15 (for calendar-year filers), but your Q1 estimate (and 2019 tax) is due July 15.
- All tax payments (federal, state, local) other than tax payments noted above are required to be timely paid unless relief has been otherwise provided.
What does CohnReznick think?The COVID-19 situation is quickly evolving on many fronts, tax being but one of many matters that need to be addressed. We applaud the Treasury and IRS for taking these steps and are glad to see that all income tax returns and related tax payments due April 15 have been automatically extended. While return filing has been automatically extended for certain taxpayers, we recommend that taxpayers expecting refunds file as soon as practical, rather than wait until the new deadline or extend. We expect more information to be provided as the situation continues to evolve, including more information on state tax filings and payments. Check our coronavirus resource center for updates.
Subject matter expertise
CPA, JD, Managing Partner - Tax
CPA, Partner, Practice Leader, Federal Tax Services
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Any advice contained in this communication, including attachments and enclosures, is not intended as a thorough, in-depth analysis of specific issues. Nor is it sufficient to avoid tax-related penalties. This has been prepared for information purposes and general guidance only and does not constitute legal or professional advice. You should not act upon the information contained in this publication without obtaining specific professional advice specific to, among other things, your individual facts, circumstances and jurisdiction. No representation or warranty (express or implied) is made as to the accuracy or completeness of the information contained in this publication, and CohnReznick LLP, its partners, employees and agents accept no liability, and disclaim all responsibility, for the consequences of you or anyone else acting, or refraining to act, in reliance on the information contained in this publication or for any decision based on it.