Last week, the IRS issued Notice 2020-18 that postponed the date for filing Federal income tax returns and paying Federal income taxes due on April 15, 2020. (See “
Whitley Penn Tax Alert: IRS Extends April 15 Filing Deadline
” dated March 21, 2020). However, the Notice left several unanswered questions related to the practical application of the postponement.
The IRS has now provided a FAQ page on its website that addresses several of those issues.
Some of the key questions addressed by the IRS in the FAQ are as follows:
- Forms to which the filing postponement applies: The IRS has identified a list of several forms that are eligible for the postponed filing date (See the subsequent link to the FAQ below). The IRS also specifically notes that returns that were due on March 16, 2020, including partnership and S-Corporation pass-through returns, are not eligible for postponement.
- Returns due on May 15, June 15, or another date: Any returns not due on April 15, 2020 are ineligible for postponement.
- Fiscal-year taxpayer income tax returns: Only fiscal-year taxpayers with returns due on April 15, 2020 are eligible for the postponement.
- Estate and gift tax returns: Notice 2020-18 applies only to Federal income tax returns and payments. Estate and gift tax returns and payments are not eligible for the postponement. These returns must be filed or extended on or before April 15, 2020.
- Information returns and payroll or excise tax payments: Notice 2020-18 applies only to Federal income tax returns and payments and does not apply to information returns or payroll and excise tax payments.
- Extension of time to file eligible returns: No extension of time is required to be filed before July 15, 2020 for an eligible return. If a taxpayer requires an additional period of time to file an eligible return after July 15, 2020, an extension of time to file will be granted until October 15, 2020 if the taxpayer submits the extension on or before July 15, 2020.
- Estimated income tax payments due between April 15 and July 15, 2020: Estimated income tax payments due on a date after April 15, 2020 are not eligible for postponement. Therefore, a calendar year taxpayer’s 2020 second quarter estimated income tax payment is still due on June 15, 2020. Note that the U.S. Senate is considering postponing all estimated tax payments until October 15, 2020 as part of the stimulus package currently being negotiated.
- IRC Section 965 installment payments: Even though the elective installment payments for the IRC Section 965 repatriation tax relate to the 2017 or 2018 tax years, the due date for the 2020 payment may be postponed to July 15, 2020.
- IRA Contributions: IRA contributions for 2019 may now be made by July 15, 2020 rather than April 15, 2020.
- Additional penalty tax on early withdrawals from retirement plans: The 10% additional tax on early withdrawals from retirement plans are now due on July 15, 2020 rather than April 15, 2020.
The full FAQ is located here:
Whitley Penn is continually monitoring the tax and economic developments related to the Coronavirus pandemic and will send out additional alerts in the future. In the interim, please call your Whitley Penn Tax Advisor if you have any questions or need any additional information.