Here is a recap on the latest information on federal and state filing and payment extensions. “New” information is highlighted as such in this communication. Of note, the IRS announced this weekend that any payment amount can now also be deferred. Read on for additional details.
Federal filing and payment guidance
- Filing deadlines extended
The U.S. Treasury announced on March 20 that they are moving the due date for federal income tax returns due on April 15, 2020, to July 15, 2020. Treasury Secretary Steven Mnuchin said, “All taxpayers and businesses will have this additional time to file and make payments without interest or penalties.”
Taxpayers are still required to file income tax returns or an automatic filing extension by July 15. The automatic filing extension (Form 4868) gives taxpayers until October 15. The guidance is unclear when the extension form should be filed if a taxpayer won’t have all necessary information to file a complete return by July 15. We are monitoring this and will update as more information is available.
- Any amount can be deferred (NEW)
There is no limitation on the amount of the payment that may be postponed. Previously, the IRS had announced dollar limits on the tax deferrals for individuals and corporations. This was revised on March 21 and indicates that taxpayers can postpone payments “regardless of the amount owed.”
Taxpayers do not need to file any additional forms to qualify for the tax payment deferral.
The due date is postponed only for federal income tax payments for 2019 normally due on April 15, 2020, and federal estimated income tax payments (including estimated payments on self-employment income) due on April 15, 2020, for the 2020 tax year.
As of this morning, the IRS hasn’t provided a payment extension for the payment or deposit of other types of federal tax (including payroll taxes and excise taxes).
- What this means for you
- IRS urges taxpayers who are owed a refund to file as quickly as possible.
- If you file your tax return or request an extension of time to file by July 15, you will automatically avoid interest and penalties on the taxes paid by July 15.
- Penalties and interest will begin to accrue on any remaining unpaid balances as of July 16, 2020.
Individual state filing and payment guidance
- Each state is addressing its own tax filing and payment extensions.
- In addition to extended income tax filings, some states have offered relief of sales and use tax payments and filings.
- We will continue to monitor state announcements and any changing due dates.
- The AICPA is also updating this chart as information becomes available from various states
To date, the following states have issued guidance on changes to income tax filings and payments:
|Colorado, Georgia, Massachusetts, Michigan, Ohio, Oregon
- State treasury departments have said they will mirror IRS guidance; however, no official pronouncements have been issued yet.
- Filing and payments extended until June 15.
- This includes quarterly estimated tax payments.
- Business payments extended until June 15.
- Individual payments extended until July 15.
- Department of Revenue will offer flexibility on the deadlines of taxes due, including corporate income taxes and sales taxes.
- Some corporate income taxes can be deferred until the end of the fiscal year.
- No other guidance has yet been provided.
- Estates with returns due between March 16-April 15 will receive a 30-day extension for filing and payment; however, statutory interest will accrue.
- Individual and corporate returns, filing and payments, including estimated tax payments, are due July 15.
- If the original due date was May 15, the extension is through August 15.
- Filing and payments due July 31 for all returns due between March 18-July 31, which does not cover estimated tax payments.
- Filing and payments extended until July 15, 2020.
- Kansas estimated tax payments for first quarter of 2020 due on April 15 are not deferred and need to be paid by April 15 to avoid penalties.
- Read more here
- Payment extension for individuals and businesses (expect this to update and include filing extension).
- Filing and payments extended until June 1 for individuals and corporate taxpayers.
- Quarterly estimates were not addressed.
- Individual filing and payments extended until July 15.
- Additional states will likely be adjusting due dates.
We will continue to keep you informed as new information becomes available. For additional information and applicability to your tax situation, we recommend consulting with your AGH tax advisor or Shawn Sullivan using the information below.
NOTE: Any advice contained in this material is not intended or written to be tax advice, and cannot be relied upon as such, nor can it be used for the purpose of avoiding tax penalties that may be imposed by the IRS or states, or promoting, marketing or recommending to another party any transaction or matter addressed herein.
Executive Vice President
Shawn serves as one of two primary leaders in the firm’s large tax group. He has extensive public and private experience in the fields of tax and accounting and works frequently with clients in the manufacturing, wholesale/retail distribution, real estate development and management, construction, and contractor industries. In addition to enhancing business performance to minimize tax consequences, he has experience in mergers and acquisitions and international tax and business structuring.
A certified public accountant, Shawn is a member of the American Institute of Certified Public Accountants, the Kansas Society of Certified Public Accountants (KSCPA) and chairs the KSCPA Committee on Taxation.