News is changing quickly, but here’s the latest from the IRS and the Treasury Department as of March 18, 2020.
The income tax payment and first quarter tax estimate payment deadlines have been extended for individuals and corporations.
To help address the economic impact of the current outbreak situation, the Treasury Department and the Internal Revenue Service have officially extended the income tax payment and first quarter income tax estimate payment deadline for individuals and corporations until July 15, 2020. They are waiving any penalties and interest related to those payments. The filing deadline still remains the same at April 15, 2020, but an extension can be filed if needed.
Individual income tax payment deferrals are limited to $1 million of 2019 income tax due. This includes individuals, self-employed individuals, trusts, estates, and other entities that are not C-Corporations. To obtain this relief, all you need to do is file your taxes by April 15th (or file an extension), and make all income tax payments by July 15, 2020.
C-corporations are eligible to deferral up to $10 million of 2019 income tax due.
It is important to note that this deferral also applies to any first quarter estimated tax payments that are otherwise due April 15, 2020, allowing extra time to determine your estimated tax payment liability in these fluid times.
Penalties and interest will start to accrue on as of July 16, 2020 on any unpaid balances, including any taxes due on extended income tax returns. So if your return is extended, you should revisit payments before then.
Individual states may make adjustments to income tax filings, but are not required to do so.
Individual states are not bound by this decision, but many have been making adjustments regarding income tax filings during this period. Wisconsin has not yet clarified their position on income tax payment deferrals.
Still, the government is encouraging that you file your taxes by April 15.
The government is strongly encouraging all taxpayers that can file their taxes to continue to file their taxes on April 15, as many people will receive refunds, which can be put to good use right now. Electronic filing with direct deposit of your refund is the fastest, safest way to obtain that refund, and also allows you to continue to practice the social distancing and other safe habits encourage by the government.
In the coming days, additional economic stimulus ideas will be forthcoming and discussed in Congress. With this very fluid situation, be assured that we are continually monitoring what is occurring and will bring you the latest news as it becomes available. Our staff continues to process tax returns and is working diligently to get all returns completed as timely as possible.
We encourage you to consider filing your tax return in a timely manner, especially if you are expecting a refund. Should you have any questions regarding your taxes, please contact us today so we can help.