IRS Announces Tax Filing and Payment Relief

March 27, 2020

IRS Announces Tax Filing and Payment Relief

 

The IRS has issued Notice 2020-18 which states that the Secretary of the Treasury has determined that any person with a Federal income tax payment or a Federal income tax return due April 15, 2020, is affected by the COVID-19 emergency for purposes of being granted relief.  The term "person" includes an individual, a trust, estate, partnership, association, company or corporation.

 

For an Affected Taxpayer, the due date for filing Federal income tax returns and making Federal income tax payments due April 15, 2020, is automatically postponed to July 15, 2020.  Affected Taxpayers do not have to file an extension and there is no limitation on the amount of the payment that may be postponed.

 

The relief provided is available solely with respect to Federal income tax payments (including payments of tax on self-employment income) and Federal income tax returns due on April 15, 2020, in respect of an Affected Taxpayer's 2019 taxable year, and on Federal estimated income tax payments due on April 15, 2020.

 

As a result of the postponement, the period beginning on April 15, 2020 and ending on July 15, 2020, will be disregarded in the calculation of any interest, penalty, or addition to tax for the failure to file the returns or pay the tax postponed by Notice 2020-18.  Interest, penalties, and additions to tax will begin to accrue on July 16, 2020.

 

Since the due date for income tax returns has been extended, taxpayers will also have until July 15th to make 2019 contributions to their IRAs and other retirement plans that normally must be made by the due date of the tax return.

 

Please note that other Federal taxes, such as payroll and excise taxes, have not been extended.  These taxes should be paid, and their associated tax returns should be filed, by their regular due dates. Also not covered by Notice 2020-18 are tax returns with due dates other than April 15, 2020, such as calendar year nonprofit organizations filing Form 990 and corporations with a fiscal year ending on January 31, 2020, which still have a due date of May 15, 2020.

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