The IRS announced on March 20 in Notice 2020-18 that the due dates for (i) filing federal income tax returns and making federal income tax payments with respect to 2019 that are otherwise due on April 15 and (ii) making estimated income tax payments with respect to 2020 that are otherwise due on April 15 are automatically extended to July 15, 2020. On March 27, 2020, the IRS announced in Notice 2020-20 that the due dates for federal gift tax or generation-skipping transfer tax returns and payments due on April 15, 2020, are also automatically extended to July 15, 2020.
The relief applies to all applicable taxpayers — i.e., individuals, trusts, estates, partnerships, associations, companies and corporations.
The relief in Notice 2020-18 also applies to payments of tax on self-employment income.
Treasury had previously provided relief in Notice 2020-17, which was limited to an automatic extension of the due date for income tax payments but not filing obligations, and was capped. The relief now applies to filings as well, and the caps no longer apply. Notice 2020-17 is superseded.
The relief does not postpone the due dates for payments or deposits of any other type of federal tax or for the filing of any other federal returns not described above, including information returns.
As a result of these postponements, any interest, penalties or additions to tax for failure to file the applicable federal income or gift (or generation-skipping transfer) tax returns or to pay the applicable federal income or gift (or generation-skipping transfer) taxes will begin to accrue on July 16, 2020.
The IRS announcement applies only to federal filings and payments, but many states and cities have provided, or are considering, their own forms of relief.
Additional IRS Guidance
Following the issuance of Notice 2020-18, the IRS published a series of Q&As on its website (to be updated periodically) offering additional guidance with respect to Notice 2020-18. These include:
- Clarification that returns and payments due other than on April 15, 2020 – including returns of partnerships, S corporations and not-for-profits with returns due May 15, returns of fiscal year taxpayers with returns not due April 15 and estimated tax payments due June 15 – are not extended.
- The relief granted does apply to BEAT payments and installments of “transition tax” relating to untaxed foreign income of certain foreign corporations.
- The extended due date for 2020 personal income tax returns remains October 15 (with extension requests required to be filed by July 15).
- The deadline for making contributions to an IRA, HSA or Archer MSA for 2019 has been extended until July 15, 2020.
In addition, the IRS announced its “People First Initiative,” pursuant to which various collection actions will be put on hold, and payments may be suspended under existing installment agreements and Offers in Compromise until July 15.
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