For American taxpayers who haven’t yet filed, the 2020 filing deadline for the 2019 tax year is almost here. Due to the COVID-19 coronavirus pandemic, the Department of the Treasury and the Internal Revenue Service (IRS) extended the filing deadline for tax returns from April 15 to July 15, 2020.
The purpose of the extension was to provide payment relief of federal taxes to individuals and businesses in response to the COVID-19 outbreak. States with personal income taxes followed suit and extended their filing deadlines as well, but state deadlines may differ, so individuals should check with their respective states for information on those deadlines.
The Department of the Treasury and the IRS announced on June 29 the tax filing and payment deadline of July 15 will not be further postponed. “The IRS understands that those affected by the coronavirus may not be able to pay their balances in full by July 15, but we have many payment options to help taxpayers,” IRS Commissioner Chuck Rettig said in a statement. “These easy-to-use payment options are available on irs.gov, and most can be done automatically without reaching out to an IRS representative.” (1)
For taxpayers who are not able to file their 2019 returns by the July 15 deadline, individuals are eligible to request an extension to file their return. Individual taxpayers who need additional time to file can request an extension by filing Form 4868. This can be done via a tax professional, tax software or at www.irs.gov by using the Free File link. Businesses needing to file an extension must file Form 7004.
Filing an extension gives the taxpayer until October 15, 2020 to get their returns filed. Please remember that filing an extension does not mean the taxpayer does not have to pay taxes owed by the July 15 deadline. Taxpayers who owe taxes and are unable to pay the full amount by July 15 can apply to set up a payment agreement with the IRS or apply for a temporary delay of the collection process. Keep in mind the IRS will charge penalties and interest on taxes due and not paid on time.
For more information on these options, visit: https://www.irs.gov/payments/online-payment-agreement-application or https://www.irs.gov/businesses/small-businesses-self-employed/temporarily-delay-the-collection-process.
Taxes are a complicated topic, and everyone’s tax situation is unique. With this in mind, please remember it is always a good idea to check with a tax advisor before making any decisions or implementing strategies that may have tax consequences.
Authored by Dennis Culver, Insight Wealth Strategies
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