On March 17, 2021 the Internal Revenue Service announced that the 2020 federal income tax filing due date for individuals will be automatically extended from April 15, 2021, to May 17, 2021. The IRS will be providing formal guidance in the coming days.
What You Need to Know
- Until further notice, this is only relief to file and pay taxes for the 2020 tax year.
- The postponement applies to individual taxpayers, including individuals who pay self-employment tax.
- Penalties, interest and additions to tax will begin to accrue on any remaining unpaid balances as of May 17, 2021.
- The postponement does not apply to estimated tax payments that are due on April 15, 2021. These payments are still due on April 15th.
- Currently, this extended due date only applies to Federal returns. State filing deadline extensions will require independent action by each State taxing authority.
- If you have an estimated payment requirement, your first quarterly installment for tax year 2021 is still due April 15, 2021. If your estimated tax payment for the 2021 tax year will be “safe harbor” based on your prior year tax liability (which most taxpayers utilize depending on their specific tax situation), we will need to have your 2020 tax liability calculated in advance of April 15, 2021.
- The IRS also announced relief for victims of the February winter storms in Texas, Oklahoma and Louisiana earlier this year. These states have until June 15, 2021, to file various individual and business tax returns and make tax payments. This extension to May 17th does not affect the June deadline.
Our firm standard is to finalize and deliver your return no later than 21 days after we receive all information to complete. This Federal filing deadline extension does not change that standard. If your return is already in our doors, we will continue to work as expeditiously as possible to complete and deliver to you within our 21-day standard. We encourage everyone to provide your tax information as soon as possible to allow for timely completion well before the extended filing statutory deadline. In the case that you have a remaining tax liability to be paid with your 2020 tax return, we can file the return at any point before the extended filing deadline and you can postpone the payment of any amounts due until May 17, 2021 if you so choose.
Our Tax Advisory Services Group team members are here to help and happy to answer any questions you may have.