The Treasury Department and the Internal Revenue Service are providing special payment relief to individuals and businesses in response to the COVID-19 crisis facing our country. An extension of time to pay income tax due has been granted and is discussed below. The filing deadline for tax returns remains April 15, 2020.
Payment relief includes:
The payment deadline for federal income tax with a due date of April 15, 2020, is being automatically extended until July 15, 2020, for up to $1 million of 2019 tax due. The payment relief applies to all individual returns, and all entities other than C-Corporations (see below), such as estates and trusts. Relief will be provided to taxpayers automatically; therefore, no additional forms must be filed.
For C Corporations, income tax payment deadlines are being extended automatically until July 15, 2020, for up to $10 million of 2019 tax due.
Penalties and interest will begin to accrue on any remaining unpaid balances as of July 16, 2020. If you file your tax return or request an extension of time to file by April 15, 2020, you will automatically avoid penalty and interest on taxes paid by July 15, 2020.
This relief also includes estimated tax payments for tax year 2020 that are due on April 15, 2020.
- The relief does not apply to first-quarter federal payroll tax filings and payments.
- 2019 IRA contributions must still be made by April 15, 2020.
- 2019 Health Savings Accounts (HSAs) must still be funded by April 15, 2020.
- The first required minimum distribution must be taken by April 1, 2020, for anyone who deferred their first RMD from 2019 to 2020.
- Nonprofit entities must still file Form 990, 990-EZ and 990-N by May 15, 2020.
- Private foundations must file Form 990-PF by May 15, 2020.
- January 31 fiscal year-end corporations still have an original due date of May 15, 2020.
At this time, the State of Michigan has not released official word on an extension of time to pay state income taxes originally due on April 15. However, state officials recently said they would mirror any federal guidance as it is updated.
This is the information known at this time. We are continually monitoring news on the federal and state levels and will update you as additional information is made known. If you have any questions, please contact your Yeo & Yeo tax professional.