Full Breakdown: IRS Filing, Payment, and Action Deadlines

Article Highlights:

• Filing Due Date Postponement 
• Payment Due Date Postponement 
• Extensions 
• Late Filing and Late Payment Penalties 
• Required Minimum Distributions 
• 2019 IRA Contributions 
• Distributions of Excess Retirement Plan Contributions 
• 2019 HSA & Archer MSA Contributions 
• Elections 
• Cancelling Direct Withdrawals 
• Estimated Tax Payments 
• Underpayment Penalties 
• Payroll Reporting 

On April 9, 2020, the IRS issued Notice 2020-23 which has expanded the postponement of filing and payment obligations the postponement of filing and payment obligations to include those due on or after April 1, 2020 and before July 15, 2020. This notice expands on Notices 2020-18 and 2020-20.

Filing Due Date Postponement

All returns and payments due during the period April 1 through July 15, 2020 are now postponed and due on July 15, 2020. This includes:

• Individual 1040 series tax returns 
• 2016 1040 Series returns – the statute for refunds has been extended 
• Corporation Returns (1120 series, including 1120-S) 
• Association returns (Forms1120-C and 1120-H) 
• Partnership Returns (Form 1065) 
• Estate and trust income tax returns (1041 series) 
• Estimated Tax Payments (1040-ES, 1041-ES, 1120-W) 
• Estate and generation-skipping transfer tax returns (706 series) 
• Gift and generation-skipping transfer tax returns (709 series) 
• Exempt Organization returns (990-T) 
• Excise Tax Payment Filings (990-PF and 4720) 
• Net investment income tax (8960) 
• Tax on Base Erosion Payments of Taxpayers with Substantial Gross Receipts (8991) 
• REMIC (1065) 
• Info Regarding Beneficiaries Acquiring Property from a Decedent (8971)
• Estate tax payments (principal or interest) due as a result of extensions of time to pay estate taxes under Sections 6161, 6163, or 6166, and annual certification requirements under Sec 6166 

The due date for these returns is automatically postponed to July 15, 2020, and there is no need to file an extension. Interest and penalties will be disregarded for the postponement period.

CAUTION: This postponement does not include FBAR filings. However, FBARs have an automatic extension to October 15 which effectively makes October 15, 2020 the FBAR due date.

Payment Due Date Postponement

• Any payments that would have been due April 1, 2020 and before July 15, 2020 for the returns listed above are also postponed to July 15, 2020. This includes self-employment tax.
  
  
• There is no limit on the amount of the payment that can be postponed. Previous guidance in Notice 2020-17 included limits. But Notice 2020-18 supersedes that notice and there are no limits. 
  
  
• A Section 965 installment payment due on April 15, 2020 is also postponed to July 15, 2020 where it is associated with a 2019 tax return that is postponed to July 15, 2020. (Reference IRS COVID-19 Webpage Q&A #8) 
  
  
• The payment postponement also applies to any retirement plan or IRA early withdrawal penalties incurred in 2019. (Reference IRS COVID-19 Webpage Q&A #18) 

Additional Guidance

Extensions

Affected taxpayers do not have to file Forms 4868, 8892 or 7004 to extend to the July 15 due date. If more time is required after that, the 4868, 8892 or 7004 extensions can be used to extend the due date until October 15, 2020. The request must be filed by July 15, 2020. To avoid interest and penalties when filing after July 15, 2020, the anticipated tax due must be paid with the extension request. (Reference IRS COVID-19 Webpage Q&A #12)

Late Filing and Late Payment Penalties

No late filing or late payment penalties will apply during the 3-month filing and payment postponement period. Unless further relief is provided, these penalties will resume after July 15, 2020.

Required Minimum Distributions

RMDs are waived for 2020.

2019 IRA Contributions

Normally the last day to make an IRA contribution for 2019 is the unextended due date of the 2019 tax return, i.e. April 15, 2020. Since that date has been extended to July 15, 2020, the IRA contribution deadline is extended as well. (Reference IRS COVID-19 Webpage Q&A #17)

Distributions of Excess Retirement Plan Contributions

Excess elective deferrals made to retirement plans in 2019, if withdrawn by April 15, 2020, will not be included in income. This deadline has not been extended. (Reference IRS COVID-19 Webpage Q&A #19)

2019 HSA & Archer MSA Contributions

Like the IRA contribution due date, the due date for 2019 HSAs and Archer MSA contributions has been extended to July 15, 2020. (Reference IRS COVID-19 Webpage Q&A #21)

Elections

Elections that are made or required to be made on a timely filed specified form (or attachment to a specified form) will be considered to have been made timely if the specified form or attachment is filed by July 15, 2020. (Notice 2020-23)

Cancelling Direct Withdrawals

If you have already filed a return that included direct withdrawals for the tax payment, and the withdrawal date has not yet passed, the direct withdrawal can be cancelled by the taxpayer calling the IRS e-file Payment Services 24/7 at 1-888-353-4537. But wait 7-10 days after the return was accepted before calling. Cancellation requests must be received no later than 11:59 p.m. ET two business days prior to the scheduled payment date.

CAUTION: Due to circumstances where taxpayers are not able to contact e-file payment services by phone, the IRS is recommending taxpayers put a stop payment on the check at their bank.

• New Scheduled Payment - A new automatic withdrawal will need to be made or a check sent for payment no later than the July 15 due date. If sending a check, it is wise to obtain a proof of mailing from the P.O. or mail the check a couple weeks ahead of the July 15 due date. The check should be accompanied by a filled-out Form 1040-V, Payment Voucher. 

Estimated Tax Payments - (Reference IRS COVID-19 Webpage Q&A #16)

• April 15 Estimate – The due date for the April 15 estimate has been extended to July 15, 2020. 
• June 15 Estimate – Due date was extended by Notice 2020-23 and is also July 15, 2020. 

Of course, one can continue to make estimated tax payments in the usual manner and according to the usual schedule.

Underpayment Penalties

No relief from the penalty for underpayment of 2019 taxes is provided. The only relief is via Form 2210 for individuals and Form 2220 for corporations. (Reference IRS COVID-19 Webpage Q&A #24)

Payroll Reporting

Payroll reporting must continue, but certain portions of the deposit can be deferred (Act Sec 2301), and certain payroll deposits can be retained by the employer to reimburse the employer for sick and family leave payments the employer has made and the employee retention credit.

If you have any questions about this information, please contact our office.

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