The Treasury Department issued guidance on March 18th saying that taxpayers can delay paying some federal income taxes for 90 days but still must submit their tax return forms to the Internal Revenue Service — or officially request an extension — by April 15.
Individuals can delay payments of up to $1 million in taxes and corporations can get payments of up to $10 million deferred until July 15 without interest and penalties, according to a Notice published Wednesday.
The guidance clarifies and expands on US Treasury Secretary’s announcement Tuesday that businesses and individuals can delay some tax payments, which left some taxpayers confused about whether they still must file a return by the April deadline and how the payment extension would affect their specific situations.
“This guidance does not change the April 15 filing deadline,” according to the statement.
In addition, the notice extends the payment deadline for the self-employed individuals and business owners by 90 days for quarterly estimated taxes, which are also due on April 15.
James Russell, PLLC is committed to continuing to meet the needs and service expectations of our clients. Our Lynnwood office is currently open during normal operating hours. And as the well-being of our clients and our team are top priority, we offer several electronic options available during this tax season. If you have any questions about the 2020 tax filing deadline, or any other tax season questions, contact your James Russell advisor for assistance.
The global effects of the corona virus pandemic are far-reaching, for businesses around the world and of course for local businesses in the Seattle area. James Russell PLLC is committed to helping our clients during this uncertain time. One of the first effects that we are anticipating is an adjustment of federal tax deadlines. It is expected the Treasury Department and the IRS will announce this week an extension of the April 15th tax deadline by as much as 90 days and include a waiver of penalties and interest for most taxpayers.
The Treasury and IRS are very much aware that March 16th is the tax deadline for most businesses. They have indicated they will be generous in determine reasonable cause abatement of any penalties for taxpayers and tax preparers unable to file in a timely manner.
In a letter sent to IRS Commissioner Charles Rettig on Friday, the Reps. Josh Gottheimer (D-N.J.) and Paul Mitchell (R-Mich.) argued that additional time should be provided to help mitigate the impact the virus is having on local communities.
“We are writing today to request that the Internal Revenue Service (IRS) extend the deadline for tax filings for individual and business filers by ninety days, from the current date of April 15, 2020, until June 15, 2020,” they wrote. “This request is in direct response to the impact that the novel Coronavirus (COVID-19) is having on our local businesses and communities.”
Trump said during an Oval Office address on Wednesday that he would direct the Treasury Department to “defer tax payments, without interest or penalties, for certain individuals and businesses negatively impacted” by the coronavirus.
The administration has said it intends to allow individuals and businesses to defer tax filing and tax payments, which could lift some pressure off the IRS by spreading the agency’s processing work out over several more months.
We engaged James Russell PLLC in 2008, as our fledgling online advertising company was skyrocketing from less than $1 million in annual revenue to over $30 million within a couple of years. Not only did they navigate an extremely complicated tax situation for us, they served as an indispensable advisor during several mergers and acquisitions. I would recommend them without reservation.
Dylan McDanniel, COO
Lexo Media Group, Inc.
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