Federal Tax Deadline Extension Explained
Around 9:15 am this morning the Treasury announced that the Federal tax FILING deadline has been pushed back to July 15th also. All information regarding payments due April 15th as stated below has not changed.
Late Wednesday, March 18, the IRS issued Notice 2020-17. The notice is intended to provide relief from tax deadlines to Americans adversely affected by the COVID-19 emergency. The notice states that any person with a Federal income tax payment due April 15, 2020 is affected by the COVID-19 emergency for purposes of this relief.
While the tax filing deadline of April 15, 2020 has not changed, the IRS has delayed all tax payments (up to $1 million dollars for individuals and $10 million for corporations) until July 15, 2020, interest and penalty free. Any amounts due above these thresholds are not eligible for penalty and interest relief. The notice includes:
1. Individual tax payments due for the 2019 tax year;
2. Corporate tax payments for calendar year C corporations;
3. Tax payments due with 2019 Gift tax returns;
4. Tax payments due with 2019 calendar year Trust returns; and
5. 2020 first-quarter estimated tax payments originally due April 15, 2020.
This deferral for making tax payments without incurring any interest or penalties is available to taxpayers who have already filed their 2019 tax return, will file their 2019 return by April 15th and taxpayers who extend their 2019 tax returns. The only requirement is the tax payment must be made by July 15, 2020 to avoid interest and penalties on the tax payment due.
Iowa has also extended not only the payment deadline but also the filing deadline to July 31 for any return or payment due April 30 without penalties or interest.
Please reach out to your LWBJ tax professional for more information on how these changes could impact you.