We previously advised that due to Coronavirus, deadlines for filing federal and state income tax returns have been extended to July 15, 2020. This week, in Notice 2020-23, the IRS provided additional extensions of time to file tax returns and pay taxes. Below are some highlights:
- The automatic extension to July 15, 2020 applies to individuals, corporations, partnerships, estates and trusts.
- The extension applies to filing tax returns and making payment of taxes due, including 1st and 2nd quarter estimated tax payments.
- Our last post highlighted a quirk and potential tax “trap” where 1st quarter estimated tax payments were extended to July 15, yet 2nd quarter estimated tax payments were not extended and were due June 15. The IRS’ most recent notice extends the deadline for both 1st and 2nd quarter estimated payments, to July 15.
- Our last post highlighted an ambiguity as to whether deadlines for IRS forms which report international assets and income (Forms 3520, 5471, 8865 and 8938) were also extended. The IRS has now confirmed that the extended deadline applies to these forms, also due July 15.
- The extension is automatic, i.e., you don’t have to request an extension.
- For the period April 15 to July 15, no interest and no penalties will be assessed by the IRS, including for 2019 tax liabilities and for 2020 estimated payments. On July 16, penalties and interest will begin again.
- You will still be able to extend the filing deadline, as in past years, to October 15. However, this additional extension is not automatic. You must file your extension request (IRS Form 4868) by July 15. There is no extension for paying your tax. The extension only applies to the filing of the tax return and not to the payment of tax due. Filing Form 4868 by July 15, 2020 allows you to file a tax return by October 15, 2020; however, the taxes must still be paid by July 15, 2020 or penalties will accrue.
- For the FBAR form (FinCEN 114), Report of Foreign Bank and Financial Accounts, which is also normally due on April 15, there is an automatic extension until October 15. No application is needed. The 2019 FBAR extended deadline is October 15, 2020.
In addition, deadlines for filing tax court petitions, claims for credits or refunds, and for bringing lawsuits against the IRS for credits or refunds, have also been extended.
Finally, if you are involved in an IRS audit, examination or appeal, you must be aware that not all deadlines have been automatically extended. IRS employees (auditors, examiners, appeals officers) are still working, and pending IRS matters are continuing.
Please contact us with any questions.