Covid-19 Legislation

2019 Tax Return Due Dates

Update to Clients Regarding Covid-19 Enacted Legislation

Posted by Alan F. Burke, CPA, PA on March 23, 2020

 

We continue to keep up with the daily changes and updates regarding governmental relief in regards to the Covid-19 virus.  This notice is an attempt to keep you informed of what we understand to be actual enacted rules and regulations.  We are not addressing what we understand to be proposals, opinions, and/or speculations.

At President Trump’s and Congress’s direction, the IRS has issued notices regarding relief for taxpayers due to the Coronavirus.  On March 21, 2020, the IRS issued Notice 2020-18 and announcement IR-2020-58.  The following are some specific details from this Notice:

  1. The federal tax filing deadline for income taxes due April 15, 2020 has been extended to July 15, 2020.
  2. Federal income taxes due April 15, 2020, may be paid as late as July 15, 2020 without any interest, penalty, or addition to tax for failure to pay federal income tax.
  3. The penalty- and interest-free deferral applies to all taxpayers, including individual, trusts and estates, corporations, and other non-corporate tax filers, as well as those who pay self-employment tax, regardless of the amount owed.
  4. First quarter estimated tax payments that would have otherwise been due April 15, 2020, are now due July 15, 2020.
  5. The Act does not include payroll taxes or excise taxes.
  6. This is an automatic extension that requires no additional filings by the taxpayer.
  7. As of the issuance of Notice 2020-18, no guidance has been given regarding second quarter estimates that are due June 15, 2020.

Each State’s legislature decides at its level how it will handle tax returns and payments.  We are closely monitoring our resources to keep up-to-date on each State’s measures of tax relief.  Below are summaries of what we know at this time from the most common States our clients file in:

The NC Department of Revenue has announced that they will extend the April 15 tax filing deadline to July 15 for individual, corporate, and franchise taxes and will not charge late filing penalties or late payment penalties through July 15, 2020; however, they indicated they do not have the authority to waive interest.  The NC Legislature would have to pass a provision to waive late payment interest.  However, to put it into perspective, if a taxpayer owes $5,000 to NC and waits until July 15, 2020 to pay the tax, the interest would be around $75.  No guidance has been issued yet regarding estimated tax payment deadlines or deferrals.

As of March 17, 2020, South Carolina has announced that tax returns and payments due April 15 through June 1 will now be due June 1, 2020.  Penalties and interest will not be charged if payment is made by June 1.