In this time of widespread uncertainty, the Department of Treasury and the Internal Revenue Service have attempted to calm some nerves by announcing the extension of several deadlines for both individuals and businesses. Below is a summary of the most recent changes published in Notice 2020-23.
Extension of time to file
Although the IRS recently announced that the April 15, 2020, federal tax filing deadline would be moved to July 15, 2020, there was some uncertainty about later deadlines such as those for U.S. Nonresident Aliens that file a Form 1040-NR. These are now all due July 15th, along with virtually all other returns that were originally due between April 15th and July 15th including those for individuals, trusts, estates, corporations, exempt organizations and other non-corporate filers.
If a taxpayer is not able to file their tax return by July 15, 2020, an extension may be filed, as has been the practice in years past, to request an extension of time to file until October 15, 2020. Taxpayers should note that a request for additional time to file the return does not equate to additional time to pay the tax that they owe. All tax payments must be made by July 15th in order to not incur interest and penalties.
Estimated Tax Payments
The deadline for estimated tax payments for Q1, originally due April 15, 2020, was previously extended. The IRS now has extended the due date of Q2 estimated tax payments that were due on June 15, 2020, as well. Any individual or corporation that would normally make estimated payments on April 15th or June 15th can now wait until July 15th to make the estimated tax payments that they owe without being penalized.
Extension of Other Time-Sensitive Actions
The IRS also has granted an extension to July 15, 2020 for various time-sensitive actions that would have otherwise been required to be taken between April 1, 2020 and July 15, 2020, including:
- Claim tax refunds from the 2016 tax year if applicable;
- Identify or complete the acquisition of replacement property in a like-kind exchange transaction;
- Make an investment in a Qualified Opportunity Zone to defer gain on certain transactions;
- Elect under Section 83(b) to recognize income related to property received for services rendered:
- Elect under Section 338(h)(10) to recognize gain in certain corporate acquisitions;
- Elect accounting method and accounting period changes
- File petitions with the Tax Court
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