The Treasury Department and the Internal Revenue Service have announced federal income tax special payment relief to individuals and businesses in response to the COVID-19 Outbreak. Payment relief for federal income taxes allows taxpayers to delay paying federal taxes owed (under $1 million) for up to 90 days or to July 15, 2020. This payment relief automatically applies to all individual returns, including self-employed individuals and all entities other than C-Corporations, such as trusts or estates. The IRS will automatically provide this relief to taxpayers and there are no additional forms to file to qualify for this relief.
The filing deadline for individual returns remains April 15, 2020 and taxpayers unable to file by the deadline are eligible to request a six-month extension of time to file their return. Taxpayers who file valid extensions of time to file will not be subject to interest and penalties if their income tax balances due are paid by July 15, 2020. Penalties and interest will begin to accrue on unpaid balances as of July 16, 2020.
C Corporations are being automatically extended until July 15, 2020, for up to $10 million of their 2019 tax due.
This relief also includes estimated tax payments for tax year 2020 that are due on April 15, 2020.
State filing and payment deadlines vary and are not always the same as the federal filing deadline. The California Franchise Tax Board filing and payment deadline has been extended to July 15, 2020. This applies to all individuals and business entities for: 2019 tax returns, 2019 tax return payments, 2020 1st and 2nd quarter estimate payments, 2020 LLC taxes and fees and 2020 non-wage withholding payments. California taxpayers do not need to claim any special treatment to qualify for this relief.
For our clients that will be extended we will reach out to you as needed to coordinate.
On Wednesday the Senate also passed the House’s coronavirus relief package, The Families First Coronavirus Response Act. The act will provide paid family leave benefits to employees, tax credits for employers and self-employed taxpayers, and FICA tax relief for employers. Please visit our website for additional information as it is released.
C&D is committed to supporting the health and well-being of our clients and team members. Our office remains closed to visitors and clients but we are available to communicate electronically via email, telephone and video conferencing. We request you continue to utilize our secure portal or secure email to electronically send and receive documents. You may also send documents via fax or use the drop slot located by our downstairs staff entrance to drop of necessary paper documents. We continue to monitor the COVID-19 daily as information become available. In the meantime, we remain committed to provide for the continuity of our clients services.
We will continue to keep you updated as there are new developments and thank you for your flexibility and support during these challenging times.