On Wednesday, March 18, 2020, The IRS and Treasury released guidance (Notice 2020-17) regarding the deferral of tax payments originally due on April 15, 2020.
As previously mentioned, taxpayers are allowed a 90-day deferral to pay their federal income taxes without any penalty or interest charges. This makes the payment due date for 2019 taxes July 15, 2020. Individual taxpayers, regardless of filing status, who owe less than $1 million, can delay their tax payments until July 15, 2020. Corporations who owe less than $10 million, can delay their tax payment to July 15, 2020 as well.
UPDATE: The 90-day deferral also applies to Federal estimated income tax payments that were originally due on April 15. Self-employment taxes are also included in the deferral.
The filing deadline for individual and corporate taxes is still April 15, 2020, so taxpayers either need to file their returns by that date, or file for an extension.
It is expected that 2nd quarter estimates will also get extended, but there hasn’t been official word on that. Although the IRS and Treasury have delayed the due date for payment, the amount of taxes that taxpayers owe will still be due. There will not be a forgiveness for the taxes owed. The deferral of payment is in the legislation to assist taxpayers who need the cash to run their businesses or pay their personal bills. However, Somerset wants to make sure that all of you are aware of the potentially large tax payments that could be due to the IRS on July 15, 2020 under this legislation. Cash flow planning, including borrowing capabilities will be critical for all of us during these next few weeks and maybe months. Somerset is here to assist all of you in this process.
Please contact your Somerset personal advisor regarding how we can help you through this crisis our country is experiencing.
Indiana Tax Filing Deadline
Governor Holcomb had a press conference today, 3/19/2020, and explained that the tax payment deadline for Indiana is delayed to 7/15/2020, similar to the Federal deadline.
- Indiana extended the payment date AND extended the filing date to July 15, 2020.
- Property taxes are still due in May, but penalties have been waived for 60 days.
- For now, sales tax deadlines remain unchanged, but options are still being evaluated.