COVID-19 UPDATES

 

In an effort to keep our clients, individuals, and businesses informed of the rapidly changing way we are currently having to do business, we created this page to provide you with the most recent applicable updates regarding the impact Coronavirus may have on you, your finances, and your business operations. 

 

Monday, August 3, 2020

Building Rehabilitation Credit

Due to the Covid-19 pandemic, IRS has released Notice 2020-58 providing relief to taxpayers to satisfy the “substantial rehabilitation test.” This applies to claiming the credit or qualifying under the TCJA transition rule.

https://www.cpapracticeadvisor.com/tax-compliance/news/21148526/irs-offers-additional-relief-for-building-rehabilitation-credit

 

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Wednesday, July 29, 2020

Required Minimum Distributions

 

In past years Required Minimum Distributions (RMD) from retirement accounts have been mandatory for individuals over 70-1/2 years old.  When the CARES Act was signed on March 27, 2020, the RMD was suspended for the year 2020.  This includes individuals who were required to begin their RMD in 2020.  This lowers the total income and the resulting tax liability.

 

What can you do if you have taken an RMD already this year?  The law provides a roll-over option where you can redeposit the money within 60 days.  But for this year only, IRS Notice 2020-51 allows a roll-over until August 31, 2020.  Normally, roll-overs are limited to one per 12-month period.  But the repayment of the 2020 RMD will not count as a roll-over.

 

This provision applies to IRA, 401(k), and 403(b) plans.  The waiver does not apply to defined benefit plans.

 

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Wednesday, July 1, 2020

The senate has approved an additional 5 weeks for Paycheck Protection Program loan applications to be accepted.

https://www.journalofaccountancy.com/news/2020/jul/senate-approves-5-week-ppp-extension.html

 

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Tuesday, June 9, 2020

New PPP legislation lowers the percentage of payroll needed for forgiveness from 75% to 60%.

https://www.journalofaccountancy.com/news/2020/jun/partial-ppp-loan-forgiveness-remains-60-percent-threshold.html

 

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Tuesday, June 9, 2020

Extension of covered period and extended loan repayment are just a couple of changes to the PPPFA enacted June 5, 2020.

https://www.accountingweb.com/practice/clients/new-law-revamps-rules-for-paycheck-protection-program

 

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Friday, May 22, 2020

PPP Forgiveness Guide

SBA has published a four-page guide to PPP Loan Forgiveness.

Click here to download or print

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Wednesday, May 20, 2020

PPP Forgiveness Webinar

Paycheck Protection Program - Forgiveness Application Review

 

The SBA released the application for forgiveness of the funds received from the Paycheck Protection Program.  This is a brief overview.

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Wednesday, May 20, 2020

PPP Loan Forgiveness Application

Link to application here.

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Wednesday, May 20, 2020

Stimulus Payments on Debit Cards

Four million stimulus payments will be sent on Debit Cards to taxpayers with no banking information.

 

https://www.cpapracticeadvisor.com/tax-compliance/news/21138853/irs-sending-out-new-coronavirus-stimulus-debit-cards

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Saturday, May 16, 2020

Paycheck Protection Program Forgiveness

The Small Business Administration (SBA) and the Department of the Treasury released the Paycheck Protection Program (PPP) Loan Forgiveness Application with instructions on Friday, May, 15, 2020.  SBA Form 3508 can be found at:  https://home.treasury.gov/system/files/136/3245-0407-SBA-Form-3508-PPP-Forgiveness-Application.pdf

 

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Tuesday, May 12, 2020

Laid-Off Employees Called Back to Work

SBA and the Treasury Department have added to the FAQ page question #40.  Many employers who received Paycheck Protection Program funds are trying to rehire their employees who may now be on unemployment.  This article details what effect an employee’s rejection of the job may have on their unemployment benefits and on the employer’s loan forgiveness.

 

https://www.journalofaccountancy.com/news/2020/may/sba-ppp-guidance-on-laid-off-employees-refuse-to-be-rehired.html

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Tuesday, May 12, 2020

Many businesses are receiving SBA Economic Injury Disaster Loan proceeds.  These are working capital loans and have restrictions on their use.  Details on their use is found in the SBA handbook on the origination of EIDL loans.  This handbook can be accessed at  

 

https://www.sba.gov/sites/default/files/2018-06/SOP%2050%2030%209-FINAL.PDF.

 

Below is a list of ineligible uses:

  1. Payment of any dividends or bonuses;

  2. Disbursements to owners, partners, officers, directors, or stockholders, except when
    directly related to performance of services for the benefit of the applicant;

  3. Repayment of stockholder/principal loans, except when the funds were injected on an
    interim basis as a result of the disaster and non-repayment would cause undue hardship
    to the stockholder/principal;

  4. Expansion of facilities or acquisition of fixed assets;

  5. Repair or replacement of physical damages;

  6. Refinancing long term debt;

  7. Paying down (including regular installment payments) or paying off loans provided, or
    owned by another Federal agency (including SBA) or a Small Business Investment
    Company licensed under the Small Business Investment Act. Federal Deposit
    Insurance Corporation (FDIC) is not considered a Federal agency for this purpose;

  8. Payment of any part of a direct Federal debt, (including SBA loans) except IRS
    obligations.

  9. Pay any penalty resulting from noncompliance with a law, regulation or order of a
    Federal, state, regional, or local agency.

  10. Contractor malfeasance; and

  11. Relocation.

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Monday, May 11, 2020

IRS explains how ineligible taxpayers should return their coronavirus stimulus payments

The Internal Revenue Service has posted information on how people who weren’t supposed to receive their economic impact payments for the novel coronavirus pandemic should return the money.

https://www.accountingtoday.com/news/irs-explains-how-ineligible-taxpayers-should-return-their-coronavirus-stimulus-payments

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Monday, May 11, 2020

SBA extends safe harbor for returning PPP funds

The U.S. Small Business Administration (SBA) has extended the safe-harbor period for returning Paycheck Protection Program (PPP) funds by one week to May 14.

https://www.journalofaccountancy.com/news/2020/may/sba-extends-safe-harbor-for-returning-ppp-funds.html

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Monday, April 20, 2020

SSA and RRB Recipients - Important Notice

If you have dependents, please read this notice. Immediate action is required on your part to receive an Economic Impact Payment for dependents.

www.irs.gov/newsroom/ssa-rrb-recipients-with-eligible-children-need-to-act-by-wednesday-to-quickly-add-money-to-their-automatic-economic-impact-payment-irs-asks-for-help-in-the-plus-500-push

 

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Friday, April 17, 2020

US CHAMBER OF COMMERCE GRANT AVAILABLE 

The U. S. Chamber of Commerce is making grants of up to $5,000 to small businesses located in an economically vulnerable community.  These will be awarded weekly.  You only need to apply one time to be eligible.

 

https://savesmallbusiness.com/

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Wednesday, April 15, 2020

FLORIDA FARMERS GET HELP FROM STATE DEPARTMENT OF AGRICULTURE

 

https://www.floridatrend.com/article/29089/commissioner-nikki-fried-launches-keep-florida-growing-webpage

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Tuesday, April 14, 2020

SBA EDL Advance

The SBA has released information about the amount of advance available to employers.

 

On March 29, 2020, following the passage of the CARES Act, the SBA provided small business owners and non-profits impacted by COVID-19 with the opportunity to obtain up to a $10,000 Advance on their Economic Injury Disaster Loan (EIDL). The Advance is available as part of the full EIDL application and will be transferred into the account you provide shortly after your application is submitted. To ensure that the greatest number of applicants can receive assistance during this challenging time, the amount of your Advance will be determined by the number of your pre-disaster (i.e., as of January 31, 2020) employees. The Advance will provide $1,000 per employee up to a maximum of $10,000.

You may be eligible for another loan program, the Paycheck Protection Program, which is available through participating lenders. Below is a comparison of the two loan programs:

                                

To locate a Paycheck Protection Program Lender, please visit: www.SBA.gov/PaycheckProtection.

Information on available resources may be found at www.sba.gov/coronavirus. For more information on these services, please go to www.sba.gov/local-assistance to locate the email address and phone number for the nearest SBA district office and/or SBA's resource partners.

Screenshot 2020-04-15 13.50.46.png

 

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Monday, April 13, 2020

IRS Issues Temporary Procedures to Process NOL's Carrybacks More Quickly

https://www.irs.gov/newsroom/temporary-procedures-to-fax-certain-forms-1139-and-1045-due-to-covid-19

 

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Friday, April 10, 2020

ECONOMIC IMPACT PAYMENTS

IRS launched a non-filer tool today for people who don’t normally file a tax return to give basic information quickly and easily.  Look for the “Non-filers: Enter Payment Info Here.”

https://content.govdelivery.com/accounts/USIRS/bulletins/285e27d?reqfrom=share

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Friday, April 10, 2020

NEW IRS TOOL TO LAUNCH

Treasury and IRS Launch New Web Tool for EIP Registration

The Treasury Department and the IRS launched a new web tool today allowing quick registration for Economic Impact Payments (EIP) for those who don't normally file a tax return.

  

EIP Distribution Begins Next Week

The IRS also reminds taxpayers that Economic Impact Payments will be distributed automatically to most people starting next week. 

 

Get My Payment Tool Available April 17

To help everyone check on the status of their payments, the IRS is building a second new tool expected to be available for use by April 17. Get My Payment will provide people with the status of their payment and allow eligible people the ability to update their direct deposit information.

 

Paper Return Processing Delayed

The IRS also announced yesterday that they are not able to process individual paper tax returns since processing centers are closed. All taxpayers are urged to e-file their returns.

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Friday, April 10, 2020

CARRYBACK PROVISIONS FOR NET OPERATING LOSSES

Needed clarification on amending prior year returns to carryback recent net operating losses was published in Revenue Procedure 2020-24 and Notice 2020-26 on Thursday, April 9, 2020.

 

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Friday, April 10, 2020

IRS EXPANDS RELIEF

Notice 2020-23 expands additional payment and filing due dates to trusts, estates, corporations, and other noncorporate tax filers. 

https://www.journalofaccountancy.com/news/2020/apr/irs-coronavirus-related-tax-relief.html

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Monday, April 6, 2020

ECONOMIC IMPACT PAYMENTS

 

IRS Charles Rettig has asked the tax preparation community to share the posters to get this information out to everyone.

 

https://www.natptax.com/TaxKnowledgeCenter/covid19resources/Documents/irs-payments-poster.pdf

 

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Friday, April 3, 2020

WEBINAR REGARDING RECENT CORONAVIRUS STIMULUS PACKAGE

 

Pam Schoelles provides direction for businesses and individuals regarding the recent Coronavirus Stimulus Package.

1. Paycheck Protection Program (PPP) - Not Paycheck Protection Loan which is different

2. SBA Economic Injury Disaster Loan

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Thursday, April 2, 2020

EMPLOYEE RETENTION CREDIT UNDER THE CARES ACT

This part of the CARES Act is designed to encourage Eligible Employers to keep employees on their payroll, despite experiencing economic hardship related to COVID-19 with an employee retention tax credit.

https://www.irs.gov/newsroom/employee-retention-credit

https://www.irs.gov/newsroom/faqs-employee-retention-credit-under-the-cares-act

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Thursday, April 2, 2020

SOCIAL SECURITY RECIPIENTS WILL AUTOMATICALLY RECEIVE ECONOMIC IMPACT PAYMENTS

The Department of the Treasury announced that social security beneficiaries who are not required to file tax returns will not need to file a return to receive the Economic Impact Payment.

https://home.treasury.gov/news/press-releases/sm967

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Wednesday, April 1, 2020

DRAKE SIMPLE RETURN NOTICE

Many clients that are not required to file income tax returns have asked if it is necessary to file to receive the advance credit payment.  This notice provides the latest information – do not file yet until final directions are provided by IRS.

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Wednesday, April 1, 2020

EMPLOYEE LEAVE REQUEST

Florida will be under a voluntary stay at home order beginning Thursday, April 2, 2020 at midnight.  If employers intend to claim a tax credit under the FFCRA, documentation needs to be retained by the employer.  The first of these for your employees to complete can be downloaded and printed here.

 

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Tuesday, March 31, 2020

ECONOMIC IMPACT PAYMENTS

This article describes who is eligible, where payments will be sent, which return information is going to be used (2018 or 2019), and when the payments will start.  Two questions my clients have asked are answered in this article:

  1. What if IRS does not have my correct direct deposit information? IRS is developing a web-based portal to submit your banking information online to receive payment quickly.

  2. What if I’m not required to file a tax return? If you are normally not required to file a tax return, IRS is directing now to do so even if your income is only from Social Security Administration.  You can use Free File.  Go to irs.gov and search “Free File.”

 

https://www.irs.gov/newsroom/economic-impact-payments-what-you-need-to-know

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Tuesday, March 31, 2020

STIMULUS PACKAGE

This post summarizes the developments of the most massive stimulus bill in American history, the Coronavirus Aid, Relief, and Economic Security (CARES) Act. The CARES Act will provide billions of dollars of relief to individuals, businesses, state and ...

 

https://www.cpapracticeadvisor.com/tax-compliance/news/21131709/summary-of-the-coronavirus-aid-relief-and-economic-security-cares-act

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Monday, March 30, 2020

 

Employers with less than 50 employees will be eligible for an exemption from the leave requirements relating to school closings or child care unavailability where the requirements would jeopardize the ability of the business to continue.  The Department of Labor will articulate the standard required to qualify.

https://www.irs.gov/newsroom/treasury-irs-and-labor-announce-plan-to-implement-coronavirus-related-paid-leave-for-workers-and-tax-credits-for-small-and-midsize-businesses-to-swiftly-recover-the-cost-of-providing-coronavirus

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Sunday, March 29, 2020

SBA offers low-interest rate loans for all states since a national disaster was declared. The website is https://www.sba.gov/disa…/apply-for-disaster-loan/index.html.

Be aware that since the CARES tax package was signed into law March 27, the Employee Retention Credit will not be available if the business has received an SBA Small Business Interruption Loan.

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Saturday, March 28, 2020

The Department of Labor has a required poster that must be posted by April 1, 2020, in a location that can be seen by all employees or emailed to them if working from home. This covers the new paid sick leave and expanded family and medical leave under the CARES act signed into law yesterday. The website to download and print or email a copy for your employees is:

https://www.dol.gov/…/p…/FFCRA_Poster_WH1422_Non-Federal.pdf

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Thursday, March 26, 2020

 

COVID-19 - Tax Return Filing & Payment Relief

 

Does the deadline postponement apply to return filing and payments?

Yes. Both the filing and payment deadlines have been automatically postponed from April 15, 2020 to July 15, 2020 for individuals, trusts, estates, corporations, or any type of unincorporated business entity. Interest and penalties will begin to accrue after July 15.

Do taxpayers need to file any additional forms to qualify for relief?

No, taxpayers do not need to submit any additional forms; the new July 15, 2020 deadline applies to all taxpayers with a Federal income tax return or payment formerly due on April 15, 2020. Individual taxpayers, who need additional time to file beyond July 15, can request a filing extension until October 15 by filing Form 4868 before the July 15 due date. Corporate filers use Form 7004 to request additional time.

Has the filing deadline for all state returns been postponed to July 15?

State filing and payment deadlines vary by state. Check with each state to get an accurate due date for filing and payment or visit our State Response to Covid-19 page.

I have already filed returns with a scheduled payment date of April 15, 2020. Will this payment be automatically rescheduled for July 15, 2020?

No, the payment will not automatically reschedule. The payment will be made on the date selected unless the payment is rescheduled. Follow the instructions below to reschedule or cancel a payment.

  • IRS Direct Pay – Use the confirmation number from scheduled payment to access the Look Up and Payment feature.

  • EFTPS -  Access the EFTPS website, then click on Payments and login. Click on Cancel a Tax Payment from the left menu and follow the instructions. 

  • Schedule Electronic Funds Withdrawal – Electronic withdrawal payments scheduled when tax returns are filed can be revoked by contacting the U.S. Treasury Financial Agent at 888-353-4537.

  • Credit/Debit Cards – Cancel scheduled payments by contacting the card processor.

Are first quarter 2020 estimated tax payments still due on April 15, 2020?

No, the April 15 estimated tax payment due date is also postponed until July 15, 2020.

Have the second quarter 2020 estimated tax payments, due on June 15, 2020, also been postponed?

No, the postponement only applies to the April 15, 2020 payment. The June 15, 2020 estimated payment due date remains the same.

Does this relief provide more time to contribute money to an IRA, HSA, or Archer MSA for 2019? 
Yes. Contributions may be made for a particular year, at any time during the year or by the due date for filing a return for that year. Because the due date for filing Federal income tax returns has been postponed to July 15, the deadline for making contributions to IRA, HSA, or Archer MSA for 2019 is also extended to July 15, 2020. 

I have tried calling the IRS for help, but I have been unable to reach anyone by telephone. What should I do?

Limited live telephone customer service assistance is currently available due to precautions taken to protect IRS employees from the coronavirus. High demand has created very lengthy wait times. The IRS encourages people to use IRS.gov for information.

How can I keep up with the IRS response to the Coronavirus and COVID-19 legislation?

For the most up-to-date information, visit the IRS Coronavirus page https://www.irs.gov/coronavirus. As information is released regarding stimulus payments and legislation, it will be posted to this page. More FAQs can be found at https://www.irs.gov/newsroom/filing-and-payment-deadlines-questions-and-answers.

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Tuesday, March 24, 2020

 

IRS Notice 2020-18

This notice contains great clarification on questions on the income tax return filing and paying relief due to COVID-19.  The link to read the full FAQ’s is https://www.irs.gov/newsroom/filing-and-payment-deadlines-questions-and-answers.  One in particular that might give some of you a sigh of relief follows:

Q17.  Does this relief provide me more time to contribute money to my IRS for 2019?

A17. Yes. Contributions can be made to your IRA, for a particular year, at any time during the year or by the due date for filing your return for that year. Because the due date for filing Federal income tax returns has been postponed to July 15, the deadline for making contributions to your IRA for 2019 is also extended to July 15, 2020. For more details on IRA contributions, see Publication 590-A, Contributions to Individual Retirement Arrangements (IRAs).

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Saturday, March 21, 2019

 

Hello everyone,

 

I hope you are having a good weekend.

 

You may be reading a lot in the media about tax changes, but there is a lot of misinformation out there, so I wanted to give you an update:

Filing Delay. You have until July 15, 2020 to file your Form 1040 or Form 1120 for C corporations. You can request an additional extension before July 15, 2020 until October 15, 2020. If you have to report foreign assets or income, we still need to file or extend by April 15, 2020. IRA contributions for 2019 are still due by April 15, 2020.

I strongly recommend preparing the return before April 15, 2020. This allows you to get your refund as well as do 2020 estimated tax payment planning.

If you submitted your information, we are currently working on it - thank you! If you have not submitted your information, please do so ASAP.

Payment Delay. Your 2019 Form 1040 balance due is due July 15, 2020. Your 2020 1st quarter estimated tax payment is due July 15, 2020. Your 2nd quarter estimated tax payment is due June 15, 2020. Yes — your 2nd quarter payment is due before your 1st quarter payment.

If these payments are already scheduled for auto-debit, you can cancel the payment: call IRS e-file Payment Services 24/7 at 1-888-353-4537 to inquire about or cancel your payment, but please wait 7 to 10 days after your return was accepted before calling.

Tax Credits. The government is providing payroll tax credits to offset mandatory paid sick & family leave for 2020. Self-employed people get a tax credit if sick and unable to work. Individuals with COVID-19 can get higher tax credits. If you get sick and want to claim this tax credit, get some type of documentation regarding your illness. We have no guidance yet on required documentation.

Proposals. There is a pending Senate bill with a slew of tax provisions, including an advance tax credit payment similar to what happened in 2008. These items are not law. It is uncertain what will be passed. More information to come.

 

If you have questions, please let me know. Stay safe!

Pam

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Thursday, March 19, 2020

Changes are happening in Washington at a rapid pace so I’m back to update you on tax stimulus available for small business owners, as well as help for employees sick and working from home.

The Senate passed the Families First Coronavirus Response Act (H.R. 6201) on March 18 on a 90-8 vote, two days after the House approved 90 pages of changes to the bill by unanimous consent. The White House signed it into law.

In addition to the changes I announced earlier in the week, there are provisions for businesses paying sick leave. For small and medium-size businesses that already provide paid sick leave, the legislation won’t change much, according to the Tax Foundation.

But employers will still be able to claim a new quarterly payroll tax credit intended to fund the paid sick leave if it is used for qualified purposes — that is, for employees who are unable to work or telework because of the Coronavirus.

The credit will cover 100 percent of the sick leave wages paid to employees who are under self-quarantine or getting tested for the Coronavirus, with a maximum wage of $511 per day. For employees caring for a family member affected by the Coronavirus, the credit covers up to $200 a day.

Large businesses with more than 500 employees are exempt from the paid leave mandate. The bill is intended to facilitate more universal coverage of sick leave, and most large businesses already offer paid sick leave.

This is a new law in addition to the announcement made on March 18 which provides interest free loans for individuals owing federal income taxes of up to $1 million and corporate taxpayers with up to $10 million in federal income tax obligations by postponing payments until July 15.

There are more changes coming as the Treasury and Congress continue to debate stimulus action. I’ll be sure to keep you updated as more help is announced.

Stay Well,

Pam Schoelles

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Wednesday, March 18, 2020

CORONAVIRUS TAX RELIEF UPDATE - MARCH 18, 2020 The Treasury Department and IRS have followed through on the relief for individuals and corporations. This is NOT an extension to file the return. The April 15 due date for individuals and corporations is not changed. This is an extension to pay the TAX DUE. Individuals can request an extension of time to file their return until October 15, 2020 but still must pay by July 15, 2020. Corporations can request an extension of time to file their return until September 15 but must pay the taxes due by July 15, 2020. Official notice just released by IRS: Notice 2020-17; Payment relief on account of Coronavirus Disease 2019 (COVID-19) emergency. The Treasury Department and IRS are extending the due date for Federal income tax payments due April 15, 2020, to July 15, 2020, for payments due of up to $10 million for corporations and up to $1 million for individuals - regardless of filing status – and other unincorporated entities. Associated interest, additions to tax, and penalties for late payment will also be suspended until July 15, 2020. Notice 2020-17 will be in IRB 2020-15, dated April 6, 2020. The IRS established a special webpage on IRS.gov/coronavirus to include all of the available tax-related information.