March 18, 2021

Tax Filing Due Date for Individuals Extended to May 17

By Diane Giordano, Partner, Tax & Business Services

Tax & Business

As a follow up to our Marcum Tax Flash, the Treasury Department and Internal Revenue Service announced on March 17, 2021 (IR 2021-59) that the federal income tax filing due date for individuals for the 2020 tax year will be automatically extended from April 15, 2021, to May 17, 2021. (The IRS will be providing more formal guidance in the coming days.)

The Treasury reached its decision based on requests from many taxpayers and lawmakers due to tax law changes as a result of the recently signed American Recovery Plan (ARP) and the IRS’s desire to continue to help taxpayers through the financial upsets related to the pandemic.

Besides the filing deadline change, individual taxpayers can also postpone federal income tax payments for the 2020 tax year due on April 15, 2021, to May 17, 2021, without penalties and interest. Penalties, interest and additions to tax will begin to accrue as of May 17, 2021.

There is no need to file any forms as this is automatic federal tax filing and payment relief. Those who need additional time to file beyond the May 17 deadline can request a filing extension by filing Form 4868 which extends the filing deadline to October 15, but does not grant an extension of time to pay taxes due. As noted, taxpayers should pay federal income tax due by May 17, 2021, to avoid interest and penalties.

This relief does not apply to estimated tax payments due on April 15, 2021. These payments will still be due on April 15. Taxes must be paid as taxpayers earn or receive income during the year, either through withholding or estimated tax payments. In general, estimated tax payments are made quarterly to the IRS by people whose income isn’t subject to income tax withholding, including self-employment income, interest, dividends, alimony or rental income. Most taxpayers automatically have their taxes withheld from their paychecks and submitted to the IRS by their employers.

The federal tax filing deadline postponement only applies to individual federal income returns and tax payments otherwise due April 15, 2021. As of this writing, state tax deadlines for filing, payments or deposits are not affected by this IRS rule.

Marcum Observations

The IRS urges taxpayers who are due a refund to file as soon as possible. Filing electronically with direct deposit is the quickest way to receive refunds.

As state filing and payment deadlines vary and do not always conform to the federal filing deadline, taxpayers should check with their state tax agencies for those details.

Your Marcum Tax advisors will keep your informed of additional federal changes or any news released by states related to filing postponements.