You’ve probably heard by now — the federal tax return filing deadline has been extended to May 17. But there’s more you need to know.
For the second year in a row, COVID-19 related tax law changes and backlogs caused by it and the stimulus payments have pushed the traditional deadline forward.
However, there are some caveats, and the deadline change isn’t as simple as it ideally should be. For a lot of tax preparers, this change has caused added confusion and problems instead of simplifying them.
We’re breaking down some important aspects of this change below.
Do you need to do anything to get the May 17 deadline?
No. The change is automatically effective for individual taxpayers. Just make sure you meet this deadline.
What needs to be filed by May 17?
Your federal tax return if it’s Form 1040 or 1040-SR. This includes sole proprietors who file Schedule C with their personal, individual tax returns.
This deadline does NOT apply to other business filers. If you’re a corporate or partnership taxpayer, or a non-profit, you must file by original tax deadlines still.
If you are eligible for the deadline delay, make sure you file electronically by midnight on May 17 or if you’re using snail mail, make sure you get your envelope postmarked May 17 by getting it to a local USPS branch on time. You’ll need to remit any taxes you owe on May 17. If you’re late by even a day, penalties and interest will start adding up.
What if you already set up payment?
The IRS will not push back collecting your money. You can change the due date to May 17 now though. For the IRS’ e-payment options, you can cancel previously scheduled payments by calling the toll-free number (888)353-4537. The IRS has suggested a 7 to 10-day wait after your return was accepted before calling.
However, you must also make it two full business days before your payment’s scheduled date (and that’s according to Eastern Time).
If you use the IRS Direct Pay option, you can use the confirmation number from the payment to access the Look Up a Payment feature, where you can change or cancel a scheduled payment. Again, this is valid until two business days before the payment date.
If you use EFTPS, you can cancel or change the date via its website. If you’ve set up the payment via your bank account or credit card, contact them directly in order to make a change.
Is May 17 now the IRA contribution deadline?
The IRS has not said this officially. However, the general opinion within the tax community seems to be that you now have until May 17 to contribute to a Roth or traditional IRA. This will then count toward the 2020 tax year.
However, it might be worth waiting to see if the IRS issues a clarification about this soon. It’s probably best not to take any chances in this matter.
When is your first 2021 estimated tax payment due?
Unfortunately, this extra tax payment still needs to be paid by April 15. Make sure you pay it if you get money not subject to payroll withholding, otherwise you will have to pay penalty and interest charges.
Is May 17 your state’s tax deadline too?
This is arguably the biggest caveat in this new IRS delay… Most folks may assume that states with an April 15 tax due date will also shift to May 17. But they’d be wrong, at least in some cases. Although a few states have announced delays, make sure you check with your state’s tax office about their tax deadline. The change should also be announced on their website.
Can’t meet the May 17 deadline either?
You can file for an extension using Form 4868. This will give you time until October 15 to get your tax forms to the IRS. Note that this extension only applies to filing your forms — if you owe taxes, you still have to pay them by May 17.
Does the May 17 change impact people living in disaster-struck areas?
If you live in parts of Louisiana, Oklahoma, or Texas that were hit hard by February’s events, then your June 15 deadline remains in effect still.
That’s all for now. We would encourage all taxpayers to file as early as possible, and to make sure they’re not missing something in this latest IRS change. For now, mark your calendars for May 17.
If you’d like to file as soon as possible though, check our calendar for available slots and book a free appointment right here: https://msgsndr.com/widget/booking/kIWnLZ6tnIKZ5fZ6akhN
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