In response to the new coronavirus (COVID-19), the Treasury, IRS and federal government have announced several changes to the tax filing season and coronavirus relief and stimulus packages. Here is an overview of what you need to know.
The Coronavirus Aid, Relief and Economic Security (CARES) Act
On Friday, March 27, 2020, the President signed the Coronavirus Aid, Relief and Economic Security (CARES) Act — a $2 trillion stimulus package that will provide financial relief to individuals, families and businesses — into law. The 2020 coronavirus stimulus package will deliver relief through a range of measures, including an advanced tax rebate for taxpayers.
Stimulus checks for individuals and joint taxpayers. Stimulus checks — up to $1,200 for individuals, $2,400 for joint taxpayers and an additional $500 for each qualifying child — will be based on information from taxpayers’ most recent tax filings, either 2019 or 2018 if they have not yet filed this season. However, the amount paid now will be reconciled on next year’s tax return based on the taxpayer’s 2020 situation. If taxpayers have an adjusted gross income (AGI) of up to $75,000 ($150,000 married filing jointly), they should be eligible for the full amount of the recovery rebate. The stimulus check rebate completely phases out at $99,000 for single taxpayers, $146,500 for heads of household and $198,000 for joint filers. The stimulus check will be paid this year based on information from your most recent tax return and will be reconciled in tax year 2020 to ensure you received the correct rebate amount. The CARES Act also allows the government to leverage the direct deposit information in taxpayers’ tax year 2019 or 2018 tax return to deposit these stimulus funds electronically into their accounts. According to the Tax Policy Center, approximately 90% of Americans will be eligible to receive full or partial payments through the CARES Act.
Student loan payment relief. Under the CARES Act, employers can still make student loan payments on behalf of their employees on a tax free basis, up to $5,250 annually. This means the loan payments would be excluded from the employee’s income. The provision is applicable on loan payments an employer makes from the day the bill was signed into law (March 27, 2020) through Jan. 21, 2021.
Increase in unemployment payments. Unemployment payments will be increased by $600 weekly for four months through July 31, and the bill also includes those who were previously not eligible for unemployment, including part-time employees, freelancers, independent contractors, gig workers, and the self-employed.
Financial assistance provided for eligible non-profits and self-employed individuals. The Small Business Administration’s loan program is now accessible to more businesses and has an increased cap on loans. The Act provides $349 billion for the Small Business Administration to distribute through a new loan program titled the Paycheck Protection Program (PPP), making non-profits, self-employed individuals and contractors eligible to receive assistance.
The Federal Reserve lending program will also receive $454 billion in support. Loans from this fund will be for no longer than five years and will be aimed at aiding non-profits and businesses with around 500 to 10,000 employees with the goal of retaining at least 90% of their workforce with full compensation and benefits.
Penalty waived for early retirement withdrawal. If your clients need to take money out of their retirement plans, keep in mind that the 10% early withdrawal penalty will be waived on up to $100K of retirement funds withdrawn. Additionally, income attributable to such distributions would be subject to tax over three years, and you may recontribute the funds to an eligible retirement plan within three years without regard to that year’s cap on contributions.
Delay of Social Security payroll tax payment for employers. Employers, including the self-employed, can delay the payment of the employer portion of the Social Security payroll tax for the remainder of the year and pay back the liability over the next two years.
The 2019 tax filing deadline is July 15, 2020
The Treasury and IRS have announced that they will extend the 2019 tax filing deadline to July 15, 2020. The IRS expects to continue to process refunds as normal. The IRS typically issues nine out of 10 tax refunds within 21 days or less from acceptance with e-file and direct deposit – the fastest way to get a refund.
The extension of the federal tax filing deadline also applies to tax payments. Taxpayers that owe money can defer federal tax payments, interest free and penalty free until July 15. This deferment applies to all taxpayers, including individuals, trusts and estates, corporations and other non-corporate tax filers as well as those who pay self-employment tax. Taxpayers can defer tax year 2019 federal tax payments regardless of the amount owed. This deferment also applies to tax year 2020 estimated tax payments previously due on April 15, 2020.
The Families First Coronavirus Response Act (H.R. 6201)
On Wednesday, March 18, President Trump signed into law the Families First Coronavirus Response Act, or H.R. 6201, which includes relief for individuals, self-employed and businesses.
Relief for individual taxpayers. Eligible employees impacted by COVID-19 may receive paid sick and emergency sick leave.
Relief for self-employed and small businesses. The Families First Coronavirus Response First Act provides relief in the form of refundable tax credits for sick leave and family leave for eligible self-employed and small business owners.
The IRS is expected to issue additional guidance on the COVID-19 tax relief.
The State announced that state income tax filing due date is extended to July 15, 2020. Taxpayers can also defer state income tax payments due on April 15, 2020, to July 15, 2020, without penalties and interest, regardless of the amount owed. This deferment applies to all taxpayers, including individuals, trusts and estates, corporations and other non-corporate tax filers. The Commissioner of Revenue’s executive order implementing the Governor’s emergency proclamation can be found here.
Other taxes included in the deadline extension are corporate income tax, the Financial Institution Excise Tax (FIET), and the Business Privilege Tax (BPT).
Taxpayers do not need to file any additional forms to qualify for this automatic state tax filing and payment relief. Individual taxpayers who need additional time to file beyond the July 15 deadline can request a filing extension through usual methods.
By separate order, the Commissioner extended the due date for pass-through entities to file composite returns and make composite payments on behalf of their non-resident members.
Other assistance may be available on a case-by-case basis to individuals and businesses that cannot file their tax returns on time due to the COVID-19 outbreak by contacting the Department
The Department is encouraging all taxpayers to conduct their business with us through our online services. Use My Alabama Taxes (MAT) to file and pay taxes; or call (844) 877-9425 to receive additional assistance.
The Arizona Department of Revenue announced that it has moved the deadline for filing and paying state income taxes to July 15. The new deadline means taxpayers filing state returns or submitting payment after the previous April 15 deadline will not be assessed late filing, late payment penalties or interest.
Taxpayers who need more time beyond July 15 to file state income tax should consider filing for an extension by submitting Arizona Form 204 by July 15. Taxpayers do not need to submit Arizona Form 204 if they already received a federal extension form the IRS. This extended deadline includes individual, corporate and fiduciary tax returns.
For more information, go to Arizona General Tax Notice (GTN 20-10).
The State announced the Arkansas state tax deadline for individual filers will be extended to July 15, 2020. Corporate tax filers and estimated payment deadlines will remain the same, April 15, 2020.
The FTB is postponing until July 15 the filing and payment deadlines for all individuals and business entities for:
For more details regarding FTB COVID-19 tax relief, please go to ftb.ca.gov and search COVID-19.
Colorado extended the income tax payment deadline for all Colorado taxpayers until July 15, 2020, without penalty or interest. This is similar to the IRS extension, but applies to any income tax payment, regardless of the amount. Unlike the federal government, the State is not imposing any caps on the amount of tax that can be deferred.
The State will grant an extension for taxpayers who are required to make estimated income tax payments for the 2020 tax year. The Governor is also directing the Department of Revenue (DOR) to coordinate with local governments that choose to extend tax payment deadlines for property, sales and use taxes. To read the executive order, click here.
Connecticut announced an extension for certain business taxes by at least 30 days. In addition, the payments associated with these returns are also extended to the corresponding due date in June. These are the impacted returns and the associated filing dates and payment deadlines:
District of Columbia
D.C. announced that the deadline for taxpayers to file and pay their 2019 District of Columbia individual and fiduciary income tax returns (D-40, D-41, and D-40B), partnership tax returns (D-65), and franchise tax returns (D-20, D-30) is extended to July 15, 2020.
The Office of Tax and Revenue (OTR) encourages taxpayers who are able to file their returns electronically to do so.
The Georgia Department of Revenue is automatically extending the 2019 income tax filing and payment deadline to July 15, 2020, without penalties or interest. This includes state estimated income tax payments due on April 15, 2020, for the taxpayer’s 2020 taxable year. No extension is provided for the filing, payment, or deposit of any other type of state tax (including employee withholding and sales tax) or for filing of any state information returns
Indiana extended certain state filing and payment deadlines to align with the IRS to support Hoosiers during COVID-19. Individual tax returns and payments, along with estimated payments originally due by April 15, 2020, are now due on or before July 15, 2020.
If you need additional time to file, you can request an extension. Instructions for those extensions can be found on DOR’s website. If an individual requests a federal extension, Indiana automatically extends the state deadline and there is no need to file anything additional.
Customers have the following service options:
The State extended the filing and payment deadline for several state tax types, including income tax prompted by COVID-19, to provide flexibility. The order extends filing and payment deadlines for income, franchise, and moneys and credits taxes with a due date on or after March 19, 2020, and before July 31, 2020, to a new deadline of July 31, 2020. No late-filing or underpayment penalties shall be due for qualifying taxpayers who comply with the extended filing and payment deadlines in this order. Interest on unpaid taxes covered by this order shall be due beginning on August 1, 2020. Specifically, the order includes:
State income tax refunds currently are being processed at about the 30-day mark. Taxpayers can check the status of their refunds at the Department’s website where’s my refund page. Taxpayers and tax professionals who need assistance can contact the Department by email at email@example.com or call the taxpayer services phone line at (844) 877-9425 or 1-(844) 877-9425.
The Department of Revenue announced the following tax extensions:
The Department of Revenue will adopt most of the COVID-19 iincome tax relief described in recent IRS Notice 2020-18. This includes:
The State is offering guidance for filing and payment extension relief for income and franchise tax returns and payments due on April 15 and May 15, 2020. See the chart for new due dates for the 2019 income and franchise tax returns. The due date for these returns and any payments due with the returns is extended to July 15, 2020. This is an automatic extension and no extension request is necessary
The Department of Administrative and Financial Service has extended the State Income Tax Payment Deadline from April 15 to July 15, 2020. This includes any final and estimated Maine income tax payments due by April 15, 2020. Any failure-to-pay penalties and interest will be abated for the period of April 16, 2020, through July 15, 2020. The extended filing deadline for Maine income tax returns is automatically tied to any federal extension. Therefore, the filing deadline of April 15, 2020, for 2019 Maine income tax returns, is automatically extended to July 15, 2020. This includes Form 1040ME (Maine Individual Income Tax Return), Form 1041ME (Maine Income Tax Return for Estates and Trusts), and Form 1120ME (Maine Corporate Income Tax Return).
Sales tax and payroll payments will continue as normal. For questions about Maine income tax, contact Maine Revenue Services (MRS) at (207) 626-8475, or visit the MRS website at www.maine.gov/revenue.
Taxpayers who take advantage of the federal extension to file their return, now July 15, which is separate from the relief granted to pay their taxes, will continue to be automatically granted an extension on their Maryland tax filings. No additional extension forms are required. Fiscal year filers with tax years ending January 1, 2020, through March 31, 2020, are also eligible for the July 15, 2020, extension
Extended business-related tax filing deadlines until June 1 due to COVID-19 to provide relief to small businesses who may be impacted. The extension applies to certain business returns with due dates during the months of March, April and May 2020 for businesses filing sales and use tax, withholding tax, admissions and amusement tax, alcohol, tobacco, and motor fuel excise taxes, tire recycling fee and bay restoration fee returns. Business taxpayers who file and pay by the extended due date will receive a waiver of interest and penalties.
The Department of Revenue extended tax relief to individual and business taxpayers due to COVID‐19. The deadline to file and pay the 2019 individual income tax and corporate income tax is extended until May 15, 2020. The first quarter 2020 estimated tax payment is also extended until May 15, 2020. Penalty and interest will not accrue on the extension period through May 15, 2020. Withholding tax payments for the month of April are extended until May 15, 2020.
The extension does not apply to Sales Tax, Use Tax, or any other tax types. These returns should be filed and paid on the normal due date.
This payment relief applies to all individual income tax returns, income tax returns filed by C corporations, and income tax returns filed by trusts or estates. The DOR will automatically provide this relief, so filers do not need to take any additional steps to qualify.
The state extended the payment and filing deadlines for 2019 individual income taxpayers to July 15 in accordance with the new federal tax filing deadline. The Montana Department of Revenue will be lenient in waiving penalties and interest associated with late tax payments and the department will work with taxpayers on an individual basis.
The NH Department of Revenue Administration (DRA) will grant relief to all Business Tax and Interest & Dividends Tax taxpayers for the NH automatic seven-month filing extension and estimated tax payment safe harbor.
Tax year 2019 Business Tax and Interest & Dividends Tax returns and any payments due for calendar year taxpayers are due on April 15, 2020. First quarter estimate payments for tax year 2020 calendar year Business Tax and Interest & Dividends Tax taxpayers are due April 15, 2020.
Taxpayers who have paid their tax in full by the return due date are entitled to an automatic seven-month extension of the time to file the Business Tax or Interest & Dividends Tax return without incurring the failure to file penalty. If a taxpayer determines they owe additional tax when they file their return under the extended due date, interest and penalties still apply.
To provide taxpayers required to file returns on April 15, 2020, and are unable to accurately calculate their tax year 2019 liability to automatically qualify for the automatic seven- month extension due to the current COVID-19 pandemic, the DRA will not assess interest or penalties for those who file their returns and pay balance due within the extension by April 15, 2020, if they paid an amount no less than their tax year 2018 liability.
If a taxpayer needs to make an additional payment to the DRA to qualify for the return filing extension, they can pay on e-File, or by filing the one-page Form BT-EXT for Business Tax or Form DP-59-A for Interest & Dividends Tax, accompanied by the payment by April 15, 2020.
Business Tax and Interest & Dividends Tax taxpayers whose yearly liability exceeds certain thresholds are required to make quarterly estimated tax payments for the current tax year beginning on April 15, 2020.
Additional information is available at Taxpayer Services at (603) 230-5920.
The Taxation and Revenue Department announced that New Mexicans will have an extra 90 days to file and pay their 2019 personal income taxes in recognition of the economic hardships many are facing as a result of the COVID-19 pandemic. Taxpayers will have until July 15 to file and pay any taxes due.
The deadline for 2019 corporate income taxes will be extended until July 15.
The state is extending deadlines for employers to remit withholding taxes. Taken together, these as payment is received by July 15, 2020. Under New Mexico law, however, interest will accrue on any unpaid balances from April 15 forward. Withholding tax is withheld from employee wages and remitted to the state each month. Under the new action, withholding taxes normally due on the 25th of March, April, May and June will now be due on July 25. The state will waive penalties for withholding taxes not remitted during the grace period. However, under state law, interest will accrue from the original due date.
Anyone who has filed a return and is due a refund can check the status of that refund through the Taxpayer Access Point (TAP) at tax.newmexico.gov. Taxpayers are encouraged to file electronically or through the TAP system, if possible, to expedite their returns. Paper returns are still being accepted but will take longer to process.
The Department of Taxation and Finance announced the state’s income tax filing deadline is being moved to July 15 to comply with the federal government’s decision to push back the filing date due to the coronavirus outbreak. The new deadlines would be applicable to individuals and businesses. The new deadline would be for filing tax returns and paying taxes owed. No interest or penalties would be charged for either state or federal filers.
If you are a quarterly or annual sales tax vendor, and were unable to file or pay your March 20, 2020, sales tax return due to COVID-19, you may be eligible to apply to have penalty and interest waived. To determine whether you are eligible, see N-20-1, Announcement Regarding the Abatement of Penalties and Interest for Sales and Use Tax due to the Novel Coronavirus, COVID-19.
New York City
NYC is allowing for a waiver of penalties for DOF-administered business and excise taxes due between March 16, 2020, and April 25, 2020. Taxpayers may request to have the penalties waived on a late-filed extension or return, or in a separate request. If you file an extension or return or make a tax payment in accordance with these rules, you will not be subject to any late filing, late payment, or underpayment penalties. For purposes of the above filings, while late filing and late payment penalties are waived, interest, where applicable, at the appropriate underpayment rate, must be paid on all tax payments received after the original due date calculated from the original due date to the date of payment.
The North Carolina Department of Revenue has extended the deadline for individual, corporate and franchise state tax filings to July 15. They are waiving penalties for those filing and paying their taxes after April 15, as long as they file and pay their tax before the updated deadline. The extension applies to income and franchise tax returns originally due on April 15, 2020, from individuals, corporations, partnerships, trusts, and estates. Interest will be charged to filings after April 15 until the date of payment. Most taxpayers can file online for free at www.NCDOR.gov/NCfreefile
Go to NCDOR.gov for general information or call 1-(844) 877-9425, For Individual income tax refund inquiries call 1-(844) 877-9425.
The North Dakota Office of State Commissioner announced individuals or businesses who are unable to file an income tax return or pay the tax by the April 15 deadline can file and make payment through July 15, 2020, without penalty and interest. Guidance for North Dakota Taxpayers During COVID-19 Precautions can be found at www.nd.gov/tax.
North Dakota taxpayers have the ability to request additional time if they believe they will be unable to file a return or pay any other taxes in a timely manner because of a COVID-19 related situation; please contact the Office of State Tax Commissioner.
Taxpayers may also e-file by purchasing tax preparation software, by working with a tax professional, or by using the Office of State Tax Commissioner’s stand-alone free ND Fillable Forms option (for ND return only).
North Dakota tax booklets, forms and payment vouchers may be found on the Office of State Tax Commissioner’s website at www.nd.gov/tax/forms.
The Ohio Department of Taxation announced that filing deadlines for the state remains April 15. Return and Payment deadlines are listed here.
The Oklahoma Tax Commission (OTC) announced that Oklahomans now have until July 15, 2020, to file and pay their 2019 state income tax return. This is applicable to income tax due from tax year 2019 and the first quarter payment for tax year 2020, both of which would normally be due on April 15, 2020.
Check the status of your return, complete identity verification processes, make payments and much more from the comfort of your home through OkTAP.
The Department of Revenue announced the deadline for taxpayers to file their 2019 Pennsylvania personal income tax returns is extended to July 15, 2020.
Taxpayers can electronically file their Pennsylvania tax returns for free through Padirectfile, a secure, state-only electronic income tax filing system that is available through the Department of Revenue’s website. For more information or to begin filing, visit Padirectfile.
All taxpayers who received more than $33 in total gross taxable income in calendar year 2019 must file a Pennsylvania personal income tax return (PA-40) by midnight on Wednesday, July 15, 2020.
The deadline for taxpayers who make quarterly estimated personal income tax payments is also extended to July 15, 2020. That means estimated payments for the first and second quarters of 2020 will be due by July 15, 2020.
Any individual who expects to receive more than $8,000 of Pennsylvania-taxable income not subject to withholding by a Pennsylvania employer must estimate and pay personal income tax quarterly. Estimated tax due dates for individuals are typically April 15, June 15, Sept. 15 and Jan. 15, or the first following business day if any deadline falls on a weekend or holiday.
If additional time to file is needed, taxpayers have the option to file a request for an extension to file their Pennsylvania personal income tax return. The extension is available for up to six months. An extension of time to file does not extend the deadline to make a payment if you owe taxes to the commonwealth.
Because commonwealth offices are currently closed to help prevent the spread of COVID-19, there will be additional time in certain cases for taxpayers who wish to appeal a tax assessment issued by the Department of Revenue or file a petition for a tax refund with the Board of Appeals. If the appeal deadline fell on a date prior to the closure of commonwealth offices (March 16, 2020), the original appeal deadline is still applicable.
The State announced the April 15, 2020, deadline for certain tax filings and tax payments; the Division of Taxation mirrors the federal extensions to July 15 for individual filers.
The State is offering an extension for state tax returns and payments. Payments due April 1 – June 1 will now be due June 1, 2020. Penalty and interest will not be charged if payment is made by June 1.
This includes South Carolina Individual Income Taxes, Corporate Income Taxes, Sales and Use Tax, Admissions Tax, Withholding Tax, and other taxes administered by the SCDOR. They are automatically applying this tax relief for all applicable returns and payments; you do not need to take any additional action.
The Tennessee Department of Revenue has extended the due date for filing and paying the Hall income tax from April 15, 2020 to July 15, 2020. Taxpayers will have until July 15, 2020, to file returns and make any payments originally due on April 15, 2020. Interest and late filing penalties will not be applied to returns filed and payments made on or before this extended due date. The October 15, 2020, six-month extension date for the calendar year 2019 return remains unchanged.
The Utah State Tax Commission intends to follow the federal government’s tax filing and payment actions and is planning to extend the tax deadline for individuals to July 15 with no penalties or interest. For the most efficient tax assistance, use Taxpayer Access Point (TAP).
The Tax Commission is currently holding all appeal events as scheduled via telephone conference only rather than an in-person hearing. Please call (844) 877-9425.
The Vermont Department of Taxes moved the deadline for filing Vermont income tax from April 15 to July 15.
The Department will provide relief to businesses owing Meals and Rooms Tax and Sales and Use Tax by foregoing any penalty or interest for those who are not able to meet the March 25 or April 25 deadlines.
The Virginia Department of Taxation extended the due date for certain Virginia income tax payments to June 1, 2020, in response to the coronavirus disease for 2019:
If you have additional questions, please visit the Department at www.tax.virginia.gov, or contact the Department at (804) 367-8031 for individual income tax questions or (804) 367-8037 for business tax questions.
The Department of Revenue announced it will work with businesses that cannot file or pay their taxes on time due to the COVID-19 outbreak. Affected businesses that owe Washington taxes may qualify for the following assistance:
These actions are in effect during the state of emergency (February 29, 2020, through the end of the state of emergency, yet to be determined). All businesses should still file their returns if they are able to do so. Upon request, the Department will provide extensions for paying tax returns. This only applies to returns that are due and not already paid during the state of emergency (Feb. 29, 2020, through the end of the state of emergency.
The Department will delay scheduling audits of businesses that have gross income of less than $5 million in the past year, or are a certain type of business until mid-May. For audits in progress, Revenue will work with you to either issue the audit or provide an extension of up to 60 days.
The Department currently has the authority to waive interest through April 17, 2020. Please check back to see if this date gets extended.
Businesses with a temporary registration that have had their event cancelled should notify the Department by replying to the original email they received when obtaining their temporary certificate. If you no longer have the original email, you may send a message to firstname.lastname@example.org to cancel your temporary registration. The Department will waive the BLS delinquency fee for late renewals through April 17, 2020. Please check back to see if this date gets extended.
Please note that penalties and interest accrued prior to February 29, 2020, will not be waived. There will be no refunds for penalties and interest paid during the state of emergency.
The Department will waive penalties for late non-profit applications and renewals for exempt property through April 17, 2020. Please check back to see if this date gets extended.
The West Virginia State Tax Department is providing special tax filing and payment relief to individuals and corporations whose 2019 annual income return is due April 15, 2020.
The Department will automatically provide this relief, so filers do not need to take any additional steps to qualify for this extension of time.
Wisconsin income tax payment and return due dates are extended to July 15 and will automatically extend time and waive interest and penalties for taxpayers due to COVID-19. Tax filers do not have to file any extension forms to be eligible for this new due date and there is no limit on the amount of payment to be postponed, and no income exclusions. This applies to individuals, trusts, estates, partnerships, associations, companies or corporations. This relief is solely for income tax payments, estimated income tax payments and returns due April 15, 2020. There will be no interest or penalty for the period of April 15, 2020 to July 15, 2020. Interest, penalties, and underpayment interest for failure to make quarterly estimated tax payments with respect to such postponed federal income tax filings and payments will begin to accrue on July 16, 2020.