Financial Group

Tax Day for Individuals is Extended to May 17th

The U.S. Department of the Treasury extended the April 15th deadline to file and pay federal individual income taxes to May 17th.

The April 15th deadline for all other taxes (e.g., US corporate income tax returns, US income tax returns for estates and trusts, etc.) remains unchanged.

From the IRS’s March 17th press release
“This continues to be a tough time for many people, and the IRS wants to continue to do everything possible to help taxpayers navigate the unusual circumstances related to the pandemic, while also working on important tax administration responsibilities.”

“Even with the new deadline, we urge taxpayers to consider filing as soon as possible, especially those who are owed refunds. Filing electronically with direct deposit is the quickest way to get refunds, and it can help some taxpayers more quickly receive any remaining stimulus payments they may be entitled to.”

“Individual taxpayers do not need to file any forms or call the IRS to qualify for this automatic federal tax filing and payment relief. Individual taxpayers who need additional time to file beyond the May 17 deadline can request a filing extension until Oct. 15 by filing Form 4868 through their tax professional, tax software or using the Free File link on Filing Form 4868 gives taxpayers until Oct.15 to file their 2020 tax return but does not grant an extension of time to pay taxes due. Taxpayers should pay their federal income tax due by May 17, 2021, to avoid interest and penalties.

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. State filing and payment deadlines vary and are not always the same as the federal filing deadline. The IRS urges taxpayers to check with their state tax agencies for those details.”

Should You Delay or Not?
The benefits of waiting to file include delaying federal income tax payments and additional time to make contributions to Individual Retirement Accounts (IRAs), thereby reducing Adjusted Gross Income (AGI). Certainly, something to consider if you haven’t yet maxed out your IRA contributions!

Make sure you talk to your financial professional to confirm that the tax decisions you make are consistent with your overall financial plan.

Important Disclosures
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.
This information is not intended to be a substitute for specific individualized tax advice. We suggest that you discuss your specific tax issues with a qualified tax advisor.
This article was prepared by FMeX.
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