On Wednesday, March 17, the Internal Revenue Service (IRS) announced an automatic extension of the federal income tax filing due date for individuals. Individual returns for the 2020 tax year are now due on May 17, 2021, rather than the standard date of April 15, 2021.
In last week’s news release, the IRS stated their intention to issue formal guidance on the extension soon; however, no such guidance has been received to date. Here is what we know:
- In addition to a filing extension, any 2020 individual federal income tax payments otherwise due on April 15th have been extended through May 17th (regardless of the amount), without incurring penalties and interest. Any amounts still unpaid on May 17th will begin accruing penalties and interest at that time.
- The extension does NOT apply to 2021 estimated tax payments. First quarter 2021 estimated tax payments are still due April 15th.
- The extension is automatic for all individual taxpayers (i.e., no action is required). Those individuals requiring even more time to file their 2020 federal tax returns can request an extension through October 15th by filing Form 4868 by May 17th.
Subsequent to last week’s IRS announcement, the State of Missouri, State of Illinois, and the City of St. Louis have all announced similar automatic extensions of the filing and payment due dates for individual income tax and earnings tax returns due April 15th to May 17th. However, not all states have provided guidance as of this time. In addition, it is not clear whether this automatic extension applies solely to individual taxpayers, or whether it might extend to other April 15th filings (e.g., trust filings, gift tax filings, etc.). Accordingly, individuals should take care when determining whether any of their April 15th filing and/or payment obligations remain unchanged.
Given the timing of this news release is so late in the tax filing season and so many of our clients have submitted their tax information (as well as the fact that 2021 estimated tax payments are still due April 15th), our approach will be “business as usual” and we strongly encourage clients to send 2020 tax information as soon as possible if you have not already done so. To the extent possible, we will work toward completing individual tax returns currently in process by April 15th, while providing clients the option to make their final 2020 income tax payments on or near May 17th if they so choose. Of course, situations may present themselves where filing closer to the May 17th extended deadline may be necessary or advantageous.
We expect additional guidance to be forthcoming, and we will communicate such guidance as it becomes available. In the meantime, please contact us if you have any questions.