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IRS and Treasury Department Announce U.S. Tax Day Deadline Extended From April 15 to May 17, 2021

On Wednesday March 17, 2021, through IR-2021-59- the IRS and Treasury Department Announce U.S. Tax Day Deadline Extended From April 15 to May 17, 2021.

Dear Clients and Colleagues:

We waited to issue a Firm Statement pending IRS Formal Guidance, which has to date not been forthcoming as promised. 

Tax deadline status-

On Wednesday March 17, 2021, through IR-2021-59- the IRS and the Treasury Department announced that they have extended the Federal income tax filing due date for individuals for the 2020 tax year from April 15, 2021, to May 17, 2021.

Individual taxpayers can also postpone federal income tax payments for the 2020 tax year due on April 15, 2021 to May 17, 2021, without penalties and interest, regardless of the amount owed.

This postponement applies to individual taxpayers, including individuals who pay self-employment tax. However, penalties, interest and additions to tax will begin to accrue on any remaining unpaid balances as of May 17, 2021.

The Service has informed taxpayers that they do not need to file any forms to qualify for this automatic federal tax filing and payment relief.

Further, individual taxpayers who need additional time to file beyond the May 17, 2021 deadline can request a filing extension until October 15, 2021 by filing Form 4868. However, filing Form 4868 gives taxpayers until October 15 to file their 2020 tax return but does not grant an extension of time to pay taxes due.

Moreover, this relief does not apply to estimated tax payments that are due on April 15, 2021. Taxes must be paid as taxpayers earn or receive income during the year, either through withholding or estimated tax payments.

State tax returns-

The federal tax filing deadline postponement to May 17, 2021, only applies to individual federal income returns and tax (including tax on self-employment income) payments otherwise due April 15, 2021, not state tax payments or deposits or payments of any other type of federal tax. Taxpayers also will need to file income tax returns in 42 states plus the District of Columbia.  The IRS has requested taxpayers to check with their state tax agencies for those details.  

New York State Department of Tax and Finance (NYSDTF)-

On Friday, March 19, 2021 the New York State Department of Tax and Finance issued N-21-1 Announcing that they were aligning with the IRS March 17, 2021 IR-2021-59 extended the due date for personal income tax returns, and related tax payments, for the 2020 tax year from April 15, 2021, to May 17, 2021.

Accordingly, 2020 personal income tax returns originally due on April 15, 2021, and related payments of tax, will not be subject to penalties or interest if filed and paid by May 17, 2021.

However, noting in accordance with the above IRS announcement that this relief does not apply to estimated tax payments for the 2021 tax year that are due on April 15, 2021. These payments are still due on April 15, 2021.

What this means for PCSI Clients- 2020 Extension Policy:

An extension of the filing deadline from April 15 to May 17, 2021 to file 2020 U.S. individual income tax returns is simply not long enough for a majority of our clients. 

Regardless of the new May 17, 2021 payment and filing deadline, as a failsafe procedure and in an effort to protect your interests around March 31, 2021 when the IRS releases permission to file Form 4868 to extend your U.S. income tax filings until October 15, 2021, this office will immediately act on your behalf to extend all tax returns that are in house or expected to be received in accordance with PCSI literature that is currently in your possession.

PCSI policy, will occur across the board regardless of any communications that are sent and or received, on extension matters.

We strongly encourage all clients who have not sent us their 2020 Protax Organizer Packages as of yet to do so as soon as possible.  This is only a one (1) month extension of time to file and pay and in no way represents a meaningful delay.

If you need to contact us for any reason, please email or telephone me, although email is preferable. 

Again, we covet your trust and loyalty, and we are privileged to provide our professional CPA U.S. income tax services to you.

Given our current workload, we kindly ask at this time that you refrain from replying to this email so that we may concentrate our efforts on serving our valued clientele community during this busy time.

Marc J Strohl, CPA & Staff

Principal

Protax Consulting Services Inc.

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