to provide additional guidance on the postponement of the federal April 15 tax deadline to May 17, 2021 for individuals. This is the second consecutive push back of the traditional due date, but this year’s is much more restrictive.
Individual Filing Relief
Federal individual tax return filing and payments are automatically postponed until May 17, 2021. This includes the Form 1040 series (Form 1040, Form 1040-SR, Form 1040-NR, Form 1040-PR, Form 1040-SS, and Form 1040(SP)).
The Notice also extends the filing of all schedules, returns, and other forms that are filed as attachments to the Form 1040 series or required to be filed by its due date. This includes, but is not limited to:
Contributions to an IRA, HSA, Archer MSA, and Coverdell ESA can all be made for the 2020 tax year if paid by the May 17 due date as well.
And taxpayers with claims for refund that have a refund statute expiration date from April 15, 2021 through May 17, 2021 may file by May 17, 2021 for the claim to be considered timely (for example, a 2017 unfiled tax return or 2017 amended return).
Other Items Postponed
The 5498 series of forms normally due June 1, 2021 has been postponed until June 30, 2021. The 5498 series of forms includes Form 5498- IRA Contribution Information, Form 5498-SA- HSA, Archer MSA, or Medicare Advantage MSA Information, and Form 5498-ESA- Coverdell ESA Contribution Information.
The Notice also extends the time for applying for the IRS’s Annual Filing Season Program from April 15, 2021 to May 17, 2021 for the 2021 calendar year. This program encourages tax return preparers who do not have proper credentials to complete educational courses to receive an annual Record of Completion.
What Was Not Extended
Despite harsh criticism, the IRS maintained its position that 2021 first quarter estimated tax payments for individual filers remain due on April 15, 2021, even though they may be based on 2020 return information. It is important to note that taxpayers cannot plan to overpay any 2020 extension payment filed after April 15 with the intent of having the overpayment satisfy their required first quarter estimated payment. The overpayment will not be credited to the taxpayer’s account until the date the extension is filed.
Additionally, the Notice states there is no postponement for corporate, trust, estate, or other filing or payment deadlines either.
Gift tax returns are automatically extended upon the extension of an individual’s tax filing on Form 1040, however, it is unclear if this applies to the one-month postponement of the initial deadline. As such, filing of a separate gift tax return extension or return by April 15, 2021 is advisable.
No action is required at April 15th to take advantage of the one-month postponement. For an additional filing (not payment) extension to October 15, 2021, Form 4868 is required to be filed by May 17, 2021. Interest and penalties will begin to accrue on May 18, 2021.
The IRS deadline postponement to May 17 is a federal relief measure – each state has its own filing deadline as well. While the majority of states have matched or exceeded the federal postponement, at this time Hawaii has yet to comply and Arizona is still considering it.
In addition, taxpayers affected by recent natural disasters in Texas, Oklahoma, and Louisiana are not impacted by the May 17 federal filing due date and have until June 15 to file and pay taxes.
Please contact your RubinBrown team member with any questions.
By: Tony Nitti, CPA, MST
By: Amie Kuntz, CPA, MA
Readers should not act upon information presented without individual professional consultation.
Any federal tax advice contained in this communication (including any attachments): (i) is intended for your use only; (ii) is based on the accuracy and completeness of the facts you have provided us; and (iii) may not be relied upon to avoid penalties.
All Tax Consulting News Tax Consulting Services