Tax Season Update: IRS and State of Illinois Extend Tax return Due Dates
A message to our clients from Director of Tax Services, Rich Marks and Manager of Tax Services Beth Xu regarding tax filing and payment extensions due to the Coronavirus pandemic.
On March 20, 2020, the Treasury Department and Internal Revenue Service announced that the federal income tax filing due date is automatically extended from April 15, 2020, to July 15, 2020. Many states, including Illinois, have also provided special tax filing and payment relief to individuals and businesses in response to the COVID-19 outbreak.
Federal tax return deadline: Automatically Extended to July 15, 2020 – Individual taxpayers who need additional time to file beyond the July 15 deadline can request a filing extension by filing Form 4868. Businesses who need additional time must file Form 7004.
Federal tax payment deadline: Automatically Extended to July 15, 2020 – Taxpayers, including individuals and businesses, can defer federal income tax payment due on April 15, 2020 to July 15, 2020, without any penalties and interest, regardless of the amount owed.
Tax refunds – The IRS urges taxpayers who are due a refund to file as soon as possible. Most tax refunds are still being issued within 21 days.
1st Quarter Federal Estimated Payments – The additional time also includes first quarter estimated tax payments for tax year 2020 that are due on April 15, 2020 if paid by July 15, 2020. Note that second quarter federal estimated payments, oddly enough, are still due on June 15, 2020.
Do I have more time to contribute to my IRA? Yes, you now have until July 15 to make contributions to your IRA for 2019.
Deadline for state taxes – Many states are conforming to the new federal July 15, 2020 deadline. Some states have different deadlines and guidance. Illinois is following the July 15 tax deadline for 2019 returns and encourages taxpayers expecting a refund to file as soon as they can. The fastest, most secure way to receive a refund is to file tax returns electronically and request direct deposit into a checking or savings account. However, Illinois has not provided an extension of time for the first and second installments of estimated tax payments for 2020 taxes that are due April 15 and June 15 respectively.
Illinois is enforcing a shelter-in-place order effective March 21, 2020. As a result, Capstone has moved to remote working environment for employees until further notice. We continue to try our best to serve our clients and encourage you to continue sending us your tax information in an electronic format where possible. While we continue to have access to mail, our access is currently limited to only 1-2 days per week.
As always, please feel free to reach out to us for assistance or with any questions concerning the IRS guidance on taxes or other matters.
Again, we appreciate your patience and understanding as we all go through these unusual circumstances together. Please remember: Capstone is here to help you throughout this time.
We hope that you and your families are safe and healthy.
Sincerely,
Rich Marks, Director of Tax Services
Beth Xu, Manager of Tax Services
Sources
https://www.irs.gov/newsroom/irs-unveils-new-people-first-initiative-covid-19-effort-temporarily-adjusts-suspends-key-compliance-program
https://www.irs.gov/newsroom/irs-operations-during-covid-19-mission-critical-functions-continue
https://www2.illinois.gov/rev/research/publications/bulletins/Documents/2020/FY2020-24.pdf
https://www.aicpa.org/content/dam/aicpa/advocacy/tax/downloadabledocuments/coronavirus-state-filing-relief.pdf