Yesterday, the Treasury Department and the IRS issued a statement providing special tax payment relief to individuals and businesses in response to the coronavirus (COVID-19) outbreak.
COVID-19 Federal Income Tax Relief
For individuals, the income tax payment deadline has been automatically extended until July 15, 2020, for those who owe “up to $1 million on their 2019 taxes. This relief applies to individuals (including self-employed individuals) and all other entities other than C corporations. That is, this relief will apply to Subchapter S corporations, trusts, and entities classified as partnerships for federal income tax purposes as well. This relief is automatic. Taxpayers do not need to do anything to obtain this relief.
For C corporations, the income tax payment deadline has been automatically extended until July 15, 2020, for those who owe up to $10 million on their 2019 taxes.
This relief also applies to 2020 estimated tax payments that are due on April 15, 2020. Keep in mind that the filing deadline of April 15, 2020, remains in effect.
Beginning July 16, 2020, penalties and interest will begin to accrue on any unpaid balances. By filing your return on or before April 15, 2020, or requesting an extension by that date, you automatically avoid penalties and interest on taxes paid by July 15, 2020.
Visit the IRS website here for more information.
COVID-19 State Income Tax Relief
As of the time of the writing of this blog, New Jersey, New York, and Pennsylvania have not granted special payment relief to individuals and businesses in response to the COVID-19 outbreak.
About the Norris McLaughlin Taxation Attorneys
The Norris McLaughlin Taxation Law Practice Group attorneys have vast experience in all aspects of state, federal, and international tax law. Many in this diverse group of attorneys hold a Masters Degree in tax law and they frequently lecture on tax and business issues to organizations such as the tax sections of the American Bar Association, the New Jersey State Bar Association, and the Society of Certified Public Accountants. The practice group provides services in four main areas: business tax, employee benefits, trusts and estates, and tax controversy.