On March 18th, Treasury Secretary Mnuchin announced that the government would be providing taxpayers additional time to pay their federal income taxes in order to allow taxpayers to better deal with the COVID-19 pandemic. Later that day, the Treasury Department issued Notice 2020 – 17. The purpose of that notice was to provide details on how the government will handle this delay in payments.
What do you need to know?
1. The due date to pay federal income taxes, normally due on April 15th, has been extended to July 15th. This applies to 2019 payments and 2020 first quarter estimates.
2. The extension is limited to $1 million per individual return or $10 million for a corporate return.
3. This extension only applies to income taxes. All other federal payments and deposits are still due under normal dates.
Other considerations
Keep in mind that only the due date to pay taxes has been extended; at this time, the due date to file tax returns is unchanged. If you cannot be ready to file by April 15th, you may file for an extension. However, it is our recommendation that you still make every effort to file as you would in a normal year.
State governments are not required to adopt changes made by the federal government. Some states have adopted measures much more lenient than the federal government. Some states have adopted completely different measures. Fortunately, the American Institute of Certified Public Accountants (AICPA) has been attempting to keep track of all Coronavirus-related due date changes by the various states. They are posting the results of that effort at this link: https://tinyurl.com/stateduedates.
We stand ready to help
We know that the COVID-19 outbreak is causing a lot of uncertainty in the world around us. Circumstances seem to change at an almost hourly basis. Our goal is to continue giving you updates throughout this process to help relieve some of the uncertainty. If you have any questions about how this outbreak will impact you and what you can do to mitigate your risk, please contact us.