IRS & California State announced extension to pay Income taxes


Any person with a federal income tax payment due April 15, 2020, who is affected by the COVID-19 emergency is eligible for the following relief:

  • Deferral of up to $1 million in aggregate for all taxpayers other than C corporations, regardless of filing status (so the $1 million limit applies to joint filers); or
  • Deferral of up to $10 million in aggregate for C corporations (the $10 million limit applies at the consolidated group level if the corporation is part of a consolidated group).

The IRS has issued official guidance clarifying that the 90-day extension for payment of taxes does not apply to the March 15 or April 15 filing deadlines. (IRS Notice 2020-17) This means that even though the actual tax payment has been deferred until July 15, 2020, for most taxpayers, they must still file a timely extension request to avoid the late-filing penalty (or, in the case of the missed March 15 filing deadline, request penalty abatement if late-filing penalties are imposed). The relief only applies to:

  • 2019 income tax payments due on April 15, 2020 (including self-employment taxes); and
  • The April 15, 2020, estimated income tax payment due on April 15, 2020, for the 2020 taxable year (including self-employment taxes).

This federal relief is granted under IRC §7508A, which California conforms to. As a result, we believe California conforms to the July 15 payment extension. We have reached out to the FTB for confirmation. Should you have any questions regarding this, please reach out to any of the Tax professionals at the firm or at info@chugh.com

Latest Posts

Categories

  • Tax
  • Tax Planning
  • Employer Taxes: Withholding Compliance
  • Audits & Assurances
  • Agreed Upon Procedure Reports
  • Accounting
  • Accurate Accounting
  • General Accounting Services
  • Customized Accounting Services
  • Employee Benefit Plan Audits
  • Consulting
  • Financial Statement Audits
  • Internal Control Evaluation Ssae 16 Report
  • Reviews And Compilations
  • Cash Flow And Profit Analysis
  • Banking And Finance
  • Choice Of Entity And Start Up Business Services
  • Cost Segregation

© 2024 Chugh LLP Affiliate Network. All Rights Reserved