Treasury and IRS Move April 15 Tax Filing Deadline Amid COVID-19 Emergency

The April 15 deadline for filing tax returns will be postponed until July 15, after comments from Treasury Secretary Steven Mnuchin and Notice 2020-18 posted March 20 by the IRS.  This news follows Secretary Mnuchin’s statements, and the Treasury Department’s Notice 2020-17 delaying payment of taxes owed, but not filing deadlines, by 90 days.  Prior to Mnuchin’s March 20 statement and Notice 2020-17, taxpayers were still required to file tax returns by the April 15 deadline unless they timely filed for extension.

On March 20 Mnuchin tweeted “At [President Trump’s] direction, we are moving Tax Day from April 15 to July 15. All taxpayers and businesses will have this additional time to file and make payments without interest or penalties”.

Notice 2020-18 provides formal guidance and clarity following Secretary Mnuchin’s comments indicating that the filing deadline, as well as the payment of owed taxes, would be delayed.  The Secretary determined that any person with a Federal income tax payment or a Federal income tax return due April 15, 2020 is affected by the COVID-19 emergency for purposes of relief.  A “person” includes an individual, trust, estate, partnership, association, company or corporation as provided in section 7701(a)(1) of the Internal Revenue Code.  Affected taxpayers will automatically have the due date for both making payment of Federal income tax, and Federal income tax return filing, pushed to July 15, 2020. 

Notably, Notice 2020-18 removes the deferment cap of $1 million for individuals and $10 million for corporations.  In addition, affected taxpayers will not have to file Forms 4868 or 7004.

The relief provided in the notice is available solely with respect to Federal income tax payments (including payments of tax on self-employment income) and Federal income tax returns due on April 15, 2020, in respect of an affected taxpayer’s 2019 taxable year, and Federal estimated income tax payments (including payments of tax on self-employment income) due on April 15, 2020, for an affected taxpayer’s 2020 taxable year.  No extension is provided in this notice for the payment or deposit of any other type of Federal tax, or for the filing of any Federal information return.

In conjunction with the postponement of filing date and payment of taxes owed, any calculations of interest, penalty or addition to tax for failure to file the Federal income tax returns or to pay the Federal income tax postponed by the notice will be disregarded up to July 15, 2020.  Interest penalties, and additions to tax with respect to such postponed Federal income tax filings and payments will begin to accrue on July 16, 2020.

Notice 2020-18 supersedes Notice 2020-17 because of the expansion of relief provided in Notice 2020-18.  Those seeking further information can find the details here. 

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Please note: This alert contains general, condensed summaries of actual legal matters, statutes and opinions for information purposes. It is not meant to be and should not be construed as legal advice. Readers with particular needs on specific issues should retain the services of competent counsel.