On April 9, the IRS announced another round of extensions related to tax deadlines and payments for individuals and businesses. Previously, filings and payments of federal income taxes due by April 15th were extended to July 15,2020.
In Notice 2020-23, the IRS and Treasury Department dramatically expand its tax return filing and payment relief in a continued effort to reduce the long-term economic impact on our nation resulting from COVID-19. Taxpayers who have a filling or payment deadline falling on or after April 1, 2020, and before July 15, have until July 15 to file returns and make payments without penalties or interest.
The relief applies to individuals, trusts, estates, corporations and other non-corporate tax filers, including fiscal tax filers. Americans who live and work abroad also have until July 15th to file their 2019 federal income tax return and make payments.
Guidelines for Requesting Extensions Beyond July 15
Individual taxpayers needing additional time can file an extension to October 15, 2020 by filing Form 4868 through their tax professional, tax software or by using the Free File link on IRS.gov. Businesses should file Form 7004 to request the October 15 extension. It’s important to note an extension to file is not an extension on taxes owed. Taxpayers are required to estimate their tax liability and pay any taxes owed by July 15, 2020 to avoid additional interest and penalties.
Estimated Tax Payments
Besides the April 15 estimated tax payment previously extended, the Notice extends relief to estimated tax payments due by June 15, 2020. Individuals or corporations that have a quarterly estimated payment due on or after April 1, 2020, and before July 15, 2020, can wait until July 15 to make their payment without penalty.
2016 Unclaimed Refunds
The normal April 15 deadline to claim a refund on a 2016 tax return has also been extended to July 15, 2020. The law allows for a three-year window of opportunity to claim a 2016 refund. However, if the taxpayer fails to file a return within the three years, the money becomes property of the U.S. Treasury.
Our Commitment to You
ATKG is committed to keeping you up to date with the latest changes during these challenging times. Though overwhelming, these changes pave the way for opportunistic tax planning. Please contact your ATKG adviser with any questions concerns.
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Annette Goodson is a Tax Director for ATKG. She serves as the lead of the firm’s State and Local Tax practice. She brings more than 25 years of public accounting experience to the team in the areas of federal tax, state tax and recruiting. Annette is a Certified Public Accountant and received her bachelor’s degree in accounting from The University of Texas at San Antonio.
For further information on this topic or other tax questions please contact Annette Goodson or a member of our Tax practice at 210.733.6611 or firstname.lastname@example.org.