On March 13, President Trump issued an emergency declaration under the Robert T. Stafford Disaster Relief and Emergency Assistance Act concerning the COVID-19 pandemic. The emergency declaration instructed the Secretary of the Treasury to “provide relief from tax deadlines to Americans who have been adversely affected by the COVID-19 emergency, as appropriate.” In response to this directive, Secretary Mnuchin announced the following on March 17:
- All taxpayers with a federal income tax payment due April 15, 2020, is considered adversely affected by the COVID-19 emergency. This applies to both income tax obligations for 2019 and estimated income tax payments for 2020.
- Taxpayers are entitled to defer payment of the following amounts until July 15, 2020, without interest or penalties:
- For C Corporations: $10,000,000
- For all other taxpayers, regardless of filing status: $1,000,000
On March 20, Secretary Mnuchin announced via twitter that the IRS will also delay the filing obligation until July 15, 2020. Further guidance is pending on this point and it is unclear whether this will apply to estimated tax payments for 2020 or only 2019 income tax filing obligations.
Note that this extension and waiver of penalties and interest does not prohibit taxpayers from filing their tax returns before the due date. Taxpayers entitled to refunds can file on or before April 15 and will receive their tax refund as they normally would.
Further, it is important to note that these extensions apply only to Federal income taxes. State and local income taxes and tax returns may still be required to be filed on April 15. Finally, the filing and payment due dates for Federal estate and gift tax returns have not been modified.
If you have any questions, please contact Gunster's Tax Law practice.
