The Internal Revenue Service (IRS) last week announced special federal income tax return filing and payment relief in response to the ongoing Coronavirus Disease 2019 (COVID-19) emergency. Today the IRS released some answers to frequently asked questions related to the relief. Below are a few of the questions that are likely to be of interest to federal employees and retirees.
“The answers to these questions provide responses to general inquiries and are not citable as legal authority,” the IRS said. “Accordingly, the Treasury Department and the IRS are continuing to consider additional IRB guidance on these issues addressed in these FAQs.” See the end of this article for a link to the complete list of updated FAQs on the IRS website.
Who is eligible for the extension?
Any person with a Federal income tax return or payment due on April 15, 2020, is eligible for relief under the Notice. “Person” includes any type of taxpayer, such as an individual, a trust, an estate, a corporation, or any type of unincorporated business entity. The payment due refers to both 2019 Federal income tax payments (including payments of tax on self-employment income) and 2020 estimated Federal income tax payments (including payments of tax on self-employment income), regardless of the amount owed. The return or payment must be due on April 15, 2020 – this relief does not apply to Federal income tax returns and payments due on any other date.
Do I have to actually be sick, or quarantined, or have any other impact from COVID-19 to qualify for payment relief?
No, you do not have to be sick, or quarantined, or have any other impact from COVID-19 to qualify for relief. You only need to have a Federal income tax return or payment due on April 15, 2020, as described above.
What are the form numbers of the specific federal income tax returns whose filing deadlines have been postponed?
The Notice postpones the filing and payment of Federal income taxes reported on the following forms:
Form 1040, 1040-SR, 1040-NR, 1040-NR-EZ, 1040-PR, 1040-SS
Form 1041, 1041-N, 1041-QFT
Form 1120, 1120-C, 1120-F, 1120-FSC, 1120-H, 1120-L, 1120-ND, 1120-PC, 1120-POL, 1120-REIT, 1120-RIC, 1120-SF
With respect to Form 990-T, if that Form is due to be filed on April 15, then it has been postponed to July 15 under the Notice. For taxpayers whose Form 990-T is due on May 15, that due date has not been postponed under the Notice.
With respect to returns due on March 16, 2020, which include Form 1065, Form 1065-B, Form 1066, and Form 1120-S for calendar year taxpayers, the filing of those returns has not been postponed.
Individual Retirement Accounts (IRAs)
Does this provide me more time to contribute money to my IRA for 2019?
Yes. Contributions can be made to your IRA, for a particular year, at any time during the year or by the due date for filing your return for that year. Because the due date for filing Federal income tax returns has been postponed to July 15, the deadline for making contributions to your IRA for 2019 is also extended to July 15, 2020. For more details on IRA contributions, see Publication 590-A, Contributions to Individual Retirement Arrangements (IRAs).
Does this provide me more time to contribute money to my HSA or Archer MSA for 2019?
Yes. Contributions may be made to your HSA or Archer MSA, for a particular year, at any time during the year or by the due date for filing your return for that year. Because the due date for filing Federal income tax returns is now July 15, 2020, under this relief, you may make contributions to your HSA or Archer MSA for 2019 at any time up to July 15, 2020. For more details on HSA or Archer MSA contributions, see Publication 969, Health Savings Accounts and other Tax-Favored Health Plans.
I haven’t filed my 2019 federal income tax return yet, but I expect to file it by July 15. What do I need to do?
Nothing, except file and pay any tax due with your return by July 15. You don’t need to file any additional forms or call the IRS to qualify for this automatic Federal tax filing and payment relief. If you expect a refund, you are encouraged to file your return as soon as you can so that you can receive your refund. Filing electronically with direct deposit is the quickest way to get refunds. If you need more time beyond July 15 to file your return, request an automatic extension of time to file as described next.
What if I am unable to file my 2019 federal income tax return that would have been due on April 15 by July 15, 2020?
If you are an individual, you can request an automatic extension to file your Federal income tax return if you can’t file by the July 15 deadline. The easiest and fastest way to request a filing extension is to electronically file Form 4868 through your tax professional, tax software, or using the Free File link on IRS.gov. Businesses, including trusts, must file Form 7004.
You must request the automatic extension by July 15, 2020. If you properly estimate your 2019 tax liability using the information available to you and file an extension form by July 15, 2020, your tax return will be due on October 15, 2020. To avoid interest and penalties when filing your tax return after July 15, 2020, pay the tax you estimate as due with your extension request.
Does this apply to state income tax liabilities?
No, this relief applies only to Federal income tax payments. State filing and payment deadlines vary and are not always the same as the Federal filing and payment deadline. We urge you to check with your state tax agencies for those details. More information is available at https://www.taxadmin.org/state-tax-agencies.
Full List of Updated IRS FAQs
The IRS said these questions and answers will be updated periodically and “are designed to be a flexible tool to communicate information to taxpayers and tax professionals in this changing environment.” To view the complete list of FAQs, go to: https://www.irs.gov/newsroom/filing-and-payment-deadlines-questions-and-answers