April 15 Federal tax Payments Extension

Updated March 19, 2020 at 11:35 A.M.

The Treasury Department recently issued Notice 2020-17 (https://www.irs.gov/pub/irs-drop/n-20-17.pdf) addressing relief for taxpayers affected by the Coronavirus Disease 2019 Pandemic. The Treasury guidance formalizes Treasury Secretary Mnuchin's statements on deferring certain Federal tax payments due April 15, 2020 for impacted taxpayers.

The guidance applies to "any person with a Federal income tax payment due April 15, 2020" and allows for the postponement of Federal income tax payments until July 15, 2020. The postponed tax payments cannot exceed $10,000,000 for each consolidated corporate group or C-corporations. For all other affected taxpayers, the deferral is limited to $1,000,000 regardless of filing status. Note that the $1,000,000 postponement is the same whether taxpayers file single or married filing joint. In both instances, the limit is $1,000,000.

This relief applies solely to Federal income tax payments due on April 15, 2020 and includes amounts due with respect to 2019 returns as well as first quarter 2020 estimated tax payments. The notice does not allow for deferral of any other type of Federal tax such as excise or payroll taxes. States have not yet followed this guidance, but we will keep you updated as states issue guidance.

Currently, the notice does not extend the time to file tax returns and individual tax filings are still due April 15th. If the IRS does provide a change to the return filing due date, an extension of time to file your return may still be necessary. We anticipate filing significantly more extensions for the 2019 tax year. We will continue to be diligent to meet your needs but our ability to complete your tax returns by the traditional April 15th deadline will be severely diminished. Your engagement team will reach out to you with additional information.