IRS Issues Automatic Postponement of April 15, 2020 Deadline to File Federal Income Tax Returns and Make Federal Income Tax Payments Until July 15, 2020

IRS issues automatic postponement of April 15, 2020 deadline to file Federal income tax returns and make Federal income tax payments until July 15, 2020. FAQs also provided by IRS to further clarify the provisions.

Overview:

In response to the ongoing Coronavirus Disease 2019 (COVID-19) emergency, the Department of the Treasury (DOT) and the Internal Revenue Service (IRS) have announced Federal income tax return filing and payment relief in Notice 2020-18 (link below). Per Notice 2020-18, the relief automatically postpones the April 15, 2020 deadline to file Federal income tax returns and make Federal income tax payments until July 15, 2020.

Notice 2020-18

Additionally, IRS has issued Filing and Payment Deadlines Questions and Answers with respect to Notice 2020-18.

Notice 2020-18: Filing and Payment Deadlines Questions and Answers

Key Takeaways:

  • Postponement to July 15, 2020 is automatic and Affected Taxpayers do not need to file an extension to obtain relief.
  • The relief solely relates to the following payments: (i) Federal income tax payments (including payments of tax on self-employment income) due on April 15, 2020 for an Affected Taxpayer’s 2019 tax year; and (ii) Federal estimated income tax payments (including payments of tax on self-employment income) due on April 15, 2020 for an Affected Taxpayer’s 2020 tax year.
  • No extension is provided for the filing of any Federal information returns.
  • The relief does not apply to any state income tax filing/payment requirements. Taxpayers should check with their state taxing agencies for any state specific relief programs.

In Detail:

DOT and IRS recently issued Notice 2020-18 (which supersedes Notice 2020-17).  Notably, Notice 2020-18 provides the following:

  • Any person with a Federal income tax payment or a Federal income tax return due April 15, 2020, is an “Affected Taxpayer” for purposes of the COVID-19 relief described in Notice 2020-18.
  • The term “person” includes an individual, a trust, estate, partnership, association, company or corporation, as provided in section 7701(a)(1) of the Internal Revenue Code.
  • 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 Forms 4868 (Application for Automatic Extension of Time to File U.S. Individual Income Tax Return) or 7004 (Application for Automatic Extension of Time to File Certain Business Income Tax, Information, and Other Returns) to seek relief.
  • 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 Federal estimated income tax payments (including payments of tax on self-employment income) due on April 15, 2020, for an Affected Taxpayer’s 2020 taxable year.
  • No extension is provided in Notice 2020-18 for the payment or deposit of any other type of Federal tax, or for the filing of any Federal information return.
  • 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 failure to file the Federal income tax returns or to pay the Federal income taxes postponed by Notice 2020-18.
  • Interest, penalties, and additions to tax with respect to such postponed Federal income tax filings and payments will begin to accrue on July 16, 2020.

The information provided in the above does not, and is not intended to, constitute legal advice; instead, all information and content provided in the above is for general informational purposes only. Readers of this material should contact an experienced tax attorney to obtain advice with respect to any particular legal matter.

McMahon & Tivnan, PC is responsible for this content. McMahon & Tivnan, PC represents individuals, estates and businesses with federal and state tax controversies, including audits, appeals, litigation and foreign transaction reporting. Collectively, McMahon & Tivnan, PC’s Boston-based tax attorneys have more than 100 years of experience investigating and defending IRS and state tax matters.