In a Press Conference on March 17, 2020, Treasury Secretary Steven Mnuchin stated that the administration and the IRS would be moving forward with a 90-day extension to pay 2019 income taxes, otherwise due on April 15, 2020.
Individual taxpayers can delay paying their income taxes on as much as $1 Million owed for up to 90 days. Corporate filers would have the same 90-day period to pay up to $10 Million in owed taxes.
This delay applies to federal returns only. You should check with your state’s tax deadlines as several states have rolled out delays as well. California is granting a 60-day delay for affected individuals and businesses unable to file on time. Maryland is giving additional time for specific business tax returns and will grant an extension to individuals if the federal government moves forward on its 90-day delay. You can check on your states’ tax developments here.
During this 90-day federal delay period, taxpayers’ owed taxes will be interest-free and penalty-free for 90 days, according to Mnuchin’s Press Conference statements.
If at all possible, you should complete your return by April 15th, especially if you are expecting a refund and need cash.
At Midland, we are committed to keeping our clients informed of these changes in the financial industry. If you have any questions about how this may affect your tax filings, contact your accountant or financial advisor.