Your guide to the new tax filing deadline
As part of the U.S. government’s response to the impact of COVID-19, the Treasury Department and IRS delayed this year’s federal tax filing deadline from April 15 to July 15. If you’re among the millions who are taking advantage of the extra time and haven’t filed your taxes yet, there are a few details and implications you may want to keep in mind.
Set a reminder
Fortunately, the new filing date of July 15 is an automatic extension. There’s no need to file any additional paperwork or make an official request. However, you may want to set some reminders for yourself now to prevent the new date from sneaking up on you. None of us are accustomed to filing taxes in the middle of summer, and it would be unfortunate to be hit with late-filing penalties simply because you forgot.
Don’t be late
On the subject of penalties: it’s important to make sure you file by July 15, because missing that due date can be costly. In fact, if you owe taxes, the penalties for filing late are ten times higher than those for being late on your payment.
If you do become concerned that you won’t have things wrapped up on time, you’ll still have the option to file for an extension, just like you could in a normal year. It’s important to note, however, that while the regular tax deadline for 2020 was changed, the due date to file with an extension is still October 15. Also, the extension gives you three extra months to file, but if you owe money, your payment is still due on July 15.
If you are expecting a return on your taxes, go ahead and file. There’s no need to wait until July to get the money you’re owed, and generally speaking, the earlier you file, the faster the IRS will process your return and send your refund. If you owe money, you can always file your paperwork early, then wait to make your payment on July 15.
State tax filing deadlines have moved, too
If you live in one of the 41 states that taxes income, check your state’s website to see what the new filing date is. Most have changed theirs to match the federal July 15 date, but a handful have deadlines in May or June, or on other days in July.
Estimated tax payment due dates have changed
In addition to changing the tax filing deadline, the IRS also adjusted the due dates for estimated tax payments. In a typical year, the first payment of the year is due on April 15, with the second payment due June 15. For 2020, both of those due dates have been extended to July 15, allowing you to make a single payment to account for income earned between January 1 and May 31. The other two due dates for 2020 remain the same – the third payment is due September 15, and the final one by January 15, 2021.
You can still contribute to 2019 IRAs and HSAs
The delayed deadline also means that if you have an Individual Retirement Account or Health Savings Account, you now have until July 15 to make contributions to them that count for 2019. Normally you would have only been able to do this until April 15, but since this deadline is tied to the tax filing deadline, it has been automatically shifted as well. The IRS has confirmed this in a Q&A about the new filing deadline. (The Q&A is full of good information, by the way, including questions about some less-common topics like estate taxes, gift taxes and refund claims from previous tax years. It’s worth a quick read.)
With COVID-19 having such a widespread impact on so many facets of everyday life, it’s certainly nice to have a little extra time to get your taxes done. By using the time wisely and working ahead a bit, you can make this year’s tax season one less source of stress in the weeks ahead. Stay safe!
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