Tax forms and payments won’t be due to the IRS until July 15 this year, Treasury Secretary Steven Mnuchin said in a tweet, as the government looks for ways to respond to the coronavirus.
“We are moving Tax Day from April 15 to July 15,” Mnuchin said. “All taxpayers and businesses will have this additional time to file and make payments without interest or penalties.”
The announcement follows an earlier decision to delay the payment deadline, but not the filing deadline, in response to the coronavirus pandemic. Tax professionals and lawmakers from both parties have said it could confuse taxpayers to have forms and payments due on separate days.
The change gives individuals and corporations an additional three months to file and pay before they would owe interest and penalties for late filing. Many states have also delayed their filing and payment deadlines.
Mnuchin is encouraging taxpayers who are due a refund to go ahead and file despite the delay, so they can get their checks more quickly. The IRS recommends filing electronically and opting for direct deposit to get the money within about three weeks.
Part of the concern is that it could be difficult or unsafe for people to met with their tax preparer before April 15 while many businesses and most schools are shut down to prevent the spread of the virus.
“It’s welcome news and it will put the minds of millions of taxpayers and preparers at ease,” said Cindy Hockenberry, director of tax research and government relations at the National Association of Tax Professionals.
Mnuchin has said the delay would free $300 billion of liquidity in the economy as individuals and businesses have more time to address short-term cash-flow issues if they can delay their tax payments.
Individuals can delay payments of up to $1 million in taxes and corporations can defer payments of up to $10 million until July 15 without interest and penalties, according to IRS guidance published on Wednesday. The IRS hasn’t published an official notice stating which forms are included in the later filing deadline.
The IRS on Wednesday also delayed the first installment of quarterly estimated tax payments that businesses and self-employed individuals send to the IRS, which will now be due July 15. A stimulus package being negotiated in the Senate would move that deadline back even further to Oct. 15.
--With assistance from Allyson Versprille.
