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Member of Russell Bedford International, a global network of independent professional service firms.
The Internal Revenue Service announced on March 17 that the federal income tax filing due date for individuals for the 2020 tax year will be automatically extended from April 15, 2021, to May 17, 2021. The IRS will be providing formal guidance in the coming days. Here’s what the extended tax deadline for individuals may mean for you:
The postponement applies to individual taxpayers filing their 2020 income tax return. Penalties, interest and additions to tax will begin to accrue on any remaining unpaid balances as of May 17, 2021.
Individuals with estimated tax requirements do not have an extension on the first quarter 2021 estimated tax payment date. These payments are still due on April 15. We expect that individuals who usually file an extension with a payment that is specifically meant to cover the first quarter estimated tax payment will need to send two payments – the first quarterly payment on April 15, and the extension payment on May 15. If the IRS specifies otherwise, we will let you know.
The announcement did not indicate that calendar year estate/trust income tax filings received an extension of time to file. Estates/trusts appear to have the same April 15 due date.
The announcement did not indicate that calendar year C corporation tax filings received an extension of time to file. C corporations appear to have the same April 15 due date.
As the guidance seems geared specifically to individual 2020 tax returns, we do not expect that other tax filings will be extended from April 15, 2021, to May 17, 2021.
As the IRS extended the individual tax deadline, states have begun to react.
Notably, on March 18, Illinois announced that the 2020 individual income tax deadline was similarly extended from April 15, 2021, to May 17, 2021. The extension only applies to the 2020 individual income tax return; it does not apply to individual tax estimates, corporations, or estate/trust tax returns, which remain due on April 15, 2021.
Earlier this year, the IRS announced relief for victims of the February winter storms in Texas, Oklahoma and Louisiana. These states have until June 15, 2021, to file various individual and business tax returns and make tax payments. The extension to May 17 does not affect the June 15 deadline.
In short, the extended tax deadline for individuals seems to have limited application, especially for those individuals with estimated tax requirements. At Cray Kaiser, we continue to push ahead with tax season accordingly. If you have questions on how the extension may affect you, please contact us today at 630-953-4900.
Please note that this blog is based on tax laws effective in March 2021, and may not contain later amendments. Please contact Cray Kaiser for most recent information.
