IRS Releases Official Guidance After Treasury Secretary’s Announcement
Following Secretary Mnuchin’s earlier announcement, the Treasury Department released guidance on Friday, which supersedes and expands upon the guidance issued earlier this week that gave taxpayers extra time to pay their taxes but not to file. The new guidance provides for the following relief:
- The filing of 2019 federal income tax returns and the payment of 2019 federal income tax (including tax on self-employment income) due on April 15, 2020, is automatically postponed to July 15, 2020;
- The due date for filing and paying 2020 federal estimated income tax due on April 15, 2020, is postponed to July 15, 2020; and
- There is no limitation on the amount of income tax that can be deferred under this guidance (previously the income tax deferral was capped at $10 million for corporations and $1 million for other taxpayers).
The IRS also made some important clarifications, including:
- In order to obtain this relief there is no need to file an extension form by April 15;
- The relief applies only to income tax and income tax returns, therefore other types of tax and tax returns due April 15 currently are not afforded any relief. This would include, for example, gift tax, employment tax and their related tax returns;
- The relief applies to any “person” with a federal income tax payment or income tax return due April 15, which includes corporations, individuals, trusts, estates and partnerships; and
- Penalties and interest on any returns or tax filed/paid late will begin to accrue July 16, 2020.
Notably, among the states:
- New York State has unofficially announced that the federal guidelines for relief will be followed for New York State income tax returns and payments;
- California has officially pushed back the filing and payment deadlines to July 15;
- Connecticut has announced business returns to be extended to June 15 and individual payments and returns to be extended to July 15; and
- New Jersey has yet to release guidance, but is expected to follow the federal relief guidelines, as well.
We will continue to monitor the situation as it develops. Please reach out to your Wiss professional to discuss your situation and your questions.
Questions or concerns? Reach out to a Wiss team member for more information or assistance.