Most any joke or comment about the certainty of death and taxes seems ill-timed and unsavory in our current environment. Fortunately, though, Congress and the IRS have shown some mercy by extending the usual due date of April 15 to July 15 for 2019 income tax filings and payments. That’s helpful to all.
But, then, it starts to get more complicated with other tax rules tied to that April 15 date. This blog focuses on the federal tax changes affecting most individuals. See my other COVID-19 blog updates for other changes.
- What is the extended tax relief?
The tax relief due to the COVID-19 extends the deadline to file and to pay federal income taxes to July 15, 2020.
- Penalties and interest will not accrue in this time period
- An extension does not need to be filed; all qualify for this postponement automatically
- If you expect to receive a refund, the IRS urges you to file as soon as you can to receive your refund
- Does this affect my 2020 estimated tax payments?
- First quarter 2020 estimated tax payments that would have been due on April 15, 2020 are now due July 15, 2020
- The second quarter estimates are still due June 15, 2020. Oddly, the second quarter is due before the first. (We’ll just accept it and not raise any logical or reasoned critiques.)
- Does this provide me more time to contribute to my IRA?
Yes, IRA and Health Savings Account contribution deadlines have been extended to July 15, 2020
- Does this provide me more time to remove any excess contributions from my retirement account?
No. As of March 31, 2020, excess contributions to retirement accounts must still be removed before April 15, 2020.
- What if I can’t file my taxes by July 15, 2020?
If you are unable to file your 2019 income tax return by July 15, 2020, you may file an extension by July 15, 2020 and your return will be due October 15, 2020. Please note that this is only an extension to file after July 15, not an extension to pay after July 15. Interest and penalties will be assessed on tax due amounts not paid between July 15 and October 15, 2020.
- Will my scheduled payment of 2019 taxes for April 15, 2020 be automatically rescheduled for July 15, 2020?
If you have already filed your 2019 tax return and scheduled a payment of taxes for April 15, 2020, the payment will be made on April 15. It will not automatically reschedule to July 15, 2020.
The IRS has said it will update all key information as it becomes available at IRS.gov/coronavirus. The information above is obtained from sources believed to be reliable. If your particular situation is not covered by the above, then please contact us.