We're less than two months from Tax Day 2020, which was pushed to July 15 due to the coronavirus pandemic.
Or are we?
There's been some talk and a few actual reports in the media that the White House is contemplating pushing the tax deadline back again, possibly to Sept. 15 or even mid-December.
Just talk, so far: An NBC News report noted that talks of an even later Tax Day are preliminary. In that same article, Trump Administration officials stressed that no tax date change decision has been made.
But some in the tax community are still a little unsettled. After all, this White House has a habit of changing directions, tax and otherwise, without much any warning. If the economy doesn't pick up as quickly as the Administration likes — particularly if not enough businesses open and rehire staff at a rate to make a dent in economic data — additional moves could happen.
A further delay in filing and paying any due 2019 taxes has some appeal, since it would let people hang onto to their money for a while longer before having to send it to Uncle Sam.
IRS still focused on 7/15: We can take some comfort, though, that one tax head honcho is still working toward the mid-summer Tax Day.
"Currently, July 15 is the date," Internal Revenue Service Commissioner Chuck Rettig told attendees of last week's National Tax Association spring symposium, conducted virtually, of course.
That's welcome news to the tax community.
Sure, tax professionals would like as much time as they could get to sort through all the COVID-19 created changes, such as the myriad permutations of the Paycheck Protection Program (PPP).
But just like everyone else, tax preparers (and their clients) want some certainty. Keeping Tax Day 2020 on July 15 would be one tiny indication that at least part of this tax season is going along a planned route to completion.
The IRS, which is slowly bringing back more of its staff who had been sent home, also no doubt would like things to wrap up sooner rather than later.
Automatic filing extension: Plus, noted Rettig in his speech to the NTA (and covered by Tax Notes), there's already a mechanism to get more time to at least file your tax return.
Submitting Form 4868 give you until Oct. 15 to complete and file your tax return. That can be done up until the annual tax deadline, which this year is July 15. That way you'll have more time to fill in the revised Form 1040 and its now just three schedules.
But you'll still, for now, have to pay any tax you think you'll owe, or a good estimate of that amount. Don't and you could face underpayment penalties.
Perhaps the IRS will waive those penalties. Or push the extension payment requirement back to mid-October, too. Stay tuned.
Meanwhile, here's a look at Form 4868, this week's featured piece of tax paperwork on Tax Form Tuesday and the way this year to get three more months to file your return.
There are three ways to get an extension.
1. File Form 4868 electronically.
Form 4868 is the official document that will get you the automatic filing extension. You can file it electronically, which is great since most of us now use tax software programs to fill out and e-file our returns.
Just check out your chosen tax software's options to e-file for an extension. It also will give you ways to e-pay, as noted above, any tax you think you'll owe when you do finish up your 1040.
Be sure to have a copy of your 2018 tax return handy. You'll be asked to provide information from that return for taxpayer verification.
If you are so far behind in filing that you've yet to get any tax software, don't despair. You can use Free File, the IRS-tax software companies' online tax filing option, to electronically get the extra filing time even if you don't qualify to use the free service because you made too much money.
Eight companies this year offer free electronic extension filing and payment.
And if you use a tax preparer, simply give him or her a call and have your extension request and payment sent electronically by that office. This is one call they'll be happy to get.
2. E-pay your guesstimated tax due.
Sticking with computer payments, you can get your six-month form filing reprieve by simply paying what you expect you'll ultimately owe Uncle Sam.
Just go directly to one of the IRS-approved e-pay options. They are:
- Direct Pay, which as the name says, directly transfers the amount from your bank account;
- Electronic Federal Tax Payment System, or EFTPS, which is what I used earlier this week to get our extension; or
- Credit or debit card.
You'll receive a confirmation number when you pay online or, if you prefer, by phone. Note that number and keep it for your records.
If you're like me and like paper verification to back up your digital transactions, print out Form 4868 and enter your extension payment confirmation number on page 3 of that form.
The neat thing about this e-pay extension option, if you can call paying the IRS neat, is that you don't have to send in a 4868 form. Your extension will be automatically processed when you pay part or all of your estimated income tax electronically.
3. File a paper Form 4868.
Finally, if you're part of the dwindling group that still snail mails paper tax returns, you need to fill out Form 4868 by hand (or computer and print it; yes, some folks do that) and mail it to the IRS.
Yep, that's it. Just about a quarter of a letter-sized page. And as shown above, you'll have to enter:
- Your name (and spouse's name if filing jointly) and address,
- Your Social Security number (and spouse's nine ID digits if filing jointly),
- An estimate of your total tax liability for 2018,
- Total of what you have already paid for the 2018 tax year (including withholding and estimated payments), and the biggie
- How much you're paying with your extension (if any).
Once that's filled out, send it via the United States Postal Service to the appropriate IRS processing center shown in the table below.
Don't miss the deadline: Again, for now you need to make sure you get to your local post office on time. Your envelope must be postmarked July 15 or the IRS will consider you a late filer and start the interest and penalty clock ticking.
It's always a good idea to send your paper return via certified mail, especially if you push your mailing to the very last minute. That way you'll have proof you did send it on time.
Yeah, it's been (and still is) a crazy tax year. I join you in just wanting it to be over.
But if you just can't complete your Form 1040 by the July 15 deadline, it's always better, for both you and the IRS, to get an extension and then file a correct, complete tax return a bit later. When you hurry to fill out your return, you're more likely to make mistakes. And those errors mean you and the IRS will keep dealing with this wacky 2019 filing season for even longer.
You also might find these items of interest:
- State tax deadlines mostly July 15, too
- Don't forget 'normal' tax matters during COVID-19 tax season
- Estimated tax payment deadlines have changed, but you still have calculation options
|Coronavirus Caveat & More Information
In 2020, we're all dealing with extraordinary circumstances,
both in our daily lives and when it comes to our taxes.
The COVID-19 pandemic and efforts to reduce its transmission
and protect ourselves and our families means that,
for the most part, we're focusing on just getting through these trying days.
But life as we knew it before the coronavirus will return,
along with our mundane tax matters.
Here's hoping that happens soon!
In the meantime, you can find more on the virus and its effects on our taxes
by clicking Coronavirus (COVID-19) and Taxes.