Extending Tax Returns Filing Deadline Issued by IRS
The ongoing pandemic conditions have given rise to the question related to taxation. Therefore the IRS exceeded the deadline for filing 2020 federal income tax returns from April 15 to May 17, 2021.
How did this happen?
The intense pressure from lawmakers, tax professionals on the IRS to give taxpayers more time to file their 2020 federal income tax returns. This will give the tax agency the time to adjust the computer systems, forms, and backlogs to account for the tax changes that are recently enacted according to the American Rescue Plan Act. The most noticeable is the $10,200 exemption for unemployment compensation received in 2020.
Payment of federal income taxes 2020 to May 17 can also be delayed without any penalty or interest – the delay is applicable for the self-employed taxes too.
Note: Any penalties, interest, or additions to tax will be considered accrued/outstanding after May 17.
Estimated Tax Payments
These tax payments are still due on April 15. The new deadline is not applicable to the estimated tax payments.
Estimated tax payments by individuals who have no income tax withholding income, such as self-employment income, interest, dividends, alimony, or rental income, shall be made to the IRS quarterly.
The majority of employers withheld the taxes from the employee’s paychecks and submitted them to the IRS themselves.
Storm victims in the states of Texas, Oklahoma, and Louisiana have until June 15, 2021, to file various tax returns and make the required tax payments.
The general due date extension i.e. May 17 will not affect the due date of the June 15 deadline in Texas, Oklahoma, and Louisiana.
October 15 Extension
In case you need to file after May 17, you can request a filing extension until October 15, 2921. You will need Form 4868.
You will still need to pay your federal income tax by the due date to avoid any penalties so this form will not extend your time to pay your taxes.
State Tax Returns
It is expected some states will take similar action to other states to push back their own tax return filing deadline.
Since the IRS extended the due date for filing federal returns, states have more confidence to change the filing deadlines. You need to check the state tax agency you reside in.
Get the recent information about the tax, tax deductions, and filings according to a Professional Tax Agent as per states you live in.