Tax Changes Due to COVID-19
The Coronavirus has made a drastic impact in so many aspects of our world. The IRS and our government see this and are doing what they can to provide relief Americans need.
Treasury Secretary Steven Mnuchin took to Twitter and stated,
“At @realDonaldTrump’s direction, we are moving Tax Day from April 15 to July 15. All taxpayers and businesses will have this additional time to file and make payments without interest or penalties.”
A few days later the IRS released a statement confirming the news and providing additional information. The article states that the federal income tax filing due date is automatically extended from April 15, 2020 to July 15, 2020. “Taxpayers can also defer federal income tax payments due on April 15, 2020, to July 15, 2020, without penalties and interest, regardless of the amount owed. This deferment applies to all taxpayers, including individuals, trusts and estates, corporations and other non-corporate tax filers as well as those who pay self-employment tax.”
Taxpayers do not have to file any additional forms to qualify for this automatic extension. However, if you need to file beyond the July 15th deadline, you must file the correct corresponding forms. The IRS urges taxpayers to file as soon as possible if you are owed a refund and to do so electronically.
However, what does this mean for the States…? The Federal is pushed back but not all states have provided the same relief.
Illinois has released a statement which shows that they will be providing short-term relief for late sales tax payments. However, it is only for certain qualified taxpayers. Those that qualify are eating and drinking establishments that incurred less than $75,000 in sales tax liability during the 2019 calendar year. There have been no other comments about income tax.
California has extended the tax filing deadlines to July 15th, this applies to payments as well. Allowing all individual and business tax returns to be extended, with payroll tax extensions available. This link will show you who qualifies and what steps need to be taken.
Colorado has released no statement and shown no change on their end for any coronavirus relief efforts. The next legislative meeting is scheduled for March 30th with hope for an answer then.
New York‘s income tax filing and payment deadlines are tied to the federal deadline, so both deadlines have been extended to July 15.
North Carolina decided to move income and franchise tax filing and payment deadline to July 15th but interest WILL accrue between April 15th and the date of payment.
This information changes daily, this link provides up to date information on every states stance on their filing information.
Unless it is 100% clear that your state has extended the deadline for both filing and payments, our recommendation is to file and pay by the 4/15 deadline.
03/25/2019
By: Cassidy Finnegan, Quality Back Office