The IRS announcement on delaying 2019 taxes yesterday can cause some confusion. Here are a few things you should be aware of and some unanswered questions:
1. The announcement did not extend the time to file. It simply gave taxpayers another 90 days to pay the tax without additional interest or penalty during that 90 days. Your tax return is still due April 15.
2. It is not clear whether the IRS extension of payment for 2019 tax also extends the time to pay your first quarterly estimate for 2020 taxes. That estimate is normally due on April 15.
3. It is not clear what the IRS will do for those who have already efiled a return with a balance due and told the IRS to draft the money from your checking account on the due date. We’re not sure if they will wait 90 days to draft the money or draft it on April 15. We’re also not sure if there is any way you can contact them and request they change the date of the draft once you efiled.
4. It is uncertain whether the states will also honor the IRS announcement and extend their payment dates. At this time all state taxes are due on April 15 until we get further guidance from the states.
The announcement was made Tuesday and as of Wednesday at noon we looked on the IRS website for any further guidance on these issues but could find none.
The coronavirus is causing our entire economy to adjust and react to a new reality on a daily basis. Our feeling is the businesses of the USA and the world will do what they have always done. They will react to challenging situations and come up with solutions needed to survive and grow into the future.
We simply ask everyone to be safe and do what you can to work together and keep our economy strong. We will be here to support our clients and answer your questions, whether we are in the office or working remotely. We are in the business of helping people and will continue to do that any way we can.
God Bless everyone. Be safe and healthy and reach out to help someone in need.
Bert Doerhoff CPA