April 15 used to be Tax Day. But due to COVID-19, the IRS has changed a number of filing deadlines so that most tax filing and payment deadlines that normally fall from April 1, 2020, through July 14, 2020, are extended to July 15, 2020. Some new federal law changes also affect some due dates. But not all federal tax deadlines have changed. And not all states have followed suit, leading to a very confusing situation.
2020 Tax Filing Deadlines
Here’s what you need to know about tax deadlines…federal, state, and local.
Federal Income Tax Returns
The due date for filing federal 2019 returns and paying the balance of taxes due for that year for individuals and calendar-year C corporations is July 15, 2020. If more time is needed to file a return, an automatic extension is available for the asking. Individuals file Form 4868 and corporations use Form 7004 to get a filing extension to October 15, 2020. But there’s no more time to pay the balance due on the 2019 return; July 15 is the final payment deadline, with interest and penalties accruing from this day forward. The IRS offers a variety of options for those who can’t pay their tax bill in whole or in part by July 15.
State Income Tax Returns
All states and localities that have income taxes have also provided extension relief, but this hasn’t been uniform. The vast majority have provided extensions in line with the federal deadline, but some have shorter or longer extensions. For example, Idaho’s deadline has been extended only to June 15, 2020, while Iowa’s deadline has been extended to July 31, 2020. The AICPA has a listing of state-level extension dates. Be sure to monitor these deadlines; there may be additional extensions provided for you.
Estimated Taxes
Typically, the first two installments of 2020 federal estimated taxes would have been due on April 15 and June 15. Both payments are now due by July 15, 2020. But because of a law change, self-employed individuals can opt to defer the payment of the so-called employer share of Social Security taxes that are part of self-employment tax (self-employment tax is part of estimated taxes). Self-employed individuals who choose to use this deferral option and reduce their 2020 estimated taxes accordingly will then pay 50% of the deferred amount by December 31, 2021, and the other 50% by December 31, 2022.
Note: If you previously scheduled estimated tax payments for April 15 and June 15 through EFPTS.gov, you can change your payment date. If you never used this free electronic payment method but want to, keep in mind that enrollment can take up to 5 business days, so don’t delay your online application.
On the state level, again different extensions for estimated taxes apply. For example, Iowa did not extend the deadline for paying 2020 state estimated taxes, although penalty relief has been given through the end of July. New Jersey extended the first installment of 2020 estimated taxes (that had been due April 15) to July 15; no extension was provided for the second installment due June 15. But California and Massachusetts, like the federal government, extended both the first and second installments to July 15. The District of Columbia did not provide any extensions for estimated taxes.
Employment Raxes
Employers are required to deposit employment taxes according to their applicable schedule (which depends on the size of their payroll) and file certain employer returns. The deadline for depositing employment taxes has not changed. The due dates for the quarterly employer returns (Form 941) have not changed.
These forms can be used to claim refunds of certain employment taxes if employers are required to give paid sick leave and paid family leave or they claim the employee retention credit. Find guidance for the paid leave programs and the employee retention credit from the IRS. What’s more, the IRS will provide relief from the penalty for failure to deposit employment taxes for employers eligible for these refundable credits, but only to the extent of these credits.
Employers are also required to withhold state income taxes where applicable and timely deposit them. And employers are required to pay state unemployment taxes. Again, the rules for these actions may or may not have changed in your state.
Deadlines for Other Tax-Related Actions
In addition to income and employment taxes, the deadline for certain other tax-related actions have been extended:
- If you are owed a tax refund from 2016, the IRS has extended this deadline for making a refund claim to July 15, 2020. If you’re owed any state income tax refund from 2016, check on whether you have a similar extension. Your time to submit a refund claim for state and/or local income taxes may have ended on April 15.
- If you sold property at a gain and want to defer tax by investing proceeds in a qualified opportunity fund and the 180-day investment period fell between April 1, 2020, and July 14, 2020, the deadline for completing the investment is July 15, 2020.
Conclusion on 2020 Tax Filing Deadlines
You can monitor federal tax deadlines through the IRS’s Coronavirus Tax Relief for Businesses and Tax-Exempt Entities. Check your states’ deadlines through your state department of revenue, finance, or tax. Find your state’s contact information here. And work with your CPA or other tax adviser to determine the applicable deadlines for your tax actions now.
Image: Depositphotos.com