COVID-19: Fast Facts on the Tax Front
[Updated March 20, 2020 at 11:00am]
Earlier this week, U.S. Treasury Secretary Steven Mnuchin announced that the Internal Revenue Service would be delaying payment deadlines for federal income taxes until July 15, 2020. At the urging of tax preparers and lawmakers, just this morning he announced that the federal filing deadline would also be extended until July 15. Both moves are part of a series of federal actions designed to blunt the economic impact of the coronavirus on both individuals and businesses.
- The good news: Individuals and businesses with a Federal income tax payment due April 15th will have an extra 90 days to both file and pay their 2019 taxes. This payment extension includes estimated tax payments for tax year 2020 that are due on April 15, 2020.
- The details:
- If you have a filing deadline other than April 15th, it is not covered by yesterday’s relief.
- Those filing extensions are still required to calculate any remaining estimated tax liability for 2019 and pay within this 90-day window (July 15th).
- There are limits on amounts that can be deferred – for individuals it is $1 million (regardless of filing status), and for corporations it is $10 million.
- This relief is available only for federal income tax payments due on April 15, 2020 and does not apply to payroll tax remittances or 2020 tax year estimated payments except estimated payments due April 15th for the 1st quarter of 2020.
- This deferral does not necessarily apply to individual states.
- Today, Oklahoma issued Order 2020-03-19-04, which provides that the Oklahoma Tax Commission will track the Federal provisions cited above with the exception that the waiver of penalty and interest in excess of $25,000 will require district court approval.
- Other states have already extended deadlines, including return filing deadlines, so be sure to check your applicable state tax agency.