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COVID-19 IRS update: US tax filing deadline extension

UPDATE: On March 27, 2020, IRS and Treasury Department announced an extension for filing the Federal Gift (and generation-skipping transfer) Tax returns as well as any tax due on April 15, 2020 to July 15, 2020. As with the previously announced extension for Income Tax, any associated interest and penalties for late payment or late filing will be suspended until July 15, 2020. Finally, there is no need to file an extension on or before April 15, 2020 to obtain this relief.

Further to our post last week (March 18, 2020) announcing the relief provided by the IRS to extend filing deadlinethe Federal tax payment deadline from April 15 to July 15, the IRS has now also extended the tax return filing deadline to July 15th.

The income tax return filing and tax payment extension relief applies to individuals,  trusts, estates, partnerships, and corporations. Taxpayers do not have to file for an extension (Forms 4868 or 7004) to avail themselves for this relief.  In addition,  the previously announced deferral limitation of $1 million for individuals and $10 million for corporations has been eliminated

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 this relief.

The first estimated tax payments for the 2020 tax year, due on April 15, 2020, are also extended to July 15, 2020. However, there is no guidance on the second estimated tax payment which is due on June 15, 2020.

As with the initial announcement, the IRS does not address expats specifically, but we believe the tax payment and tax return filing deadline extends to expat taxpayers as well.

Finally, the IRS also recommends that you file your Federal tax return as soon as possible if you expect a refund as most tax refunds are being issued within 21 days of electronic filing their tax return.

Please note, this relief is currently available only for Federal income tax return and if you expect to file a state tax return, please keep a close look at the state’s guidance.

We will continue to keep you updated.

If you have any concerns, get in touch.

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