Tax Day Delayed To July 15
Amidst all of the economic gloom created by the COVID-19 pandemic, the IRS delivered a small ray of sunshine for the 2019 tax year by delaying Tax Day from April 15 to July 15 for all taxpayers and businesses.
The original March 13 announcement delayed tax payments only, but an additional announcement on the morning of March 20 expanded the delayed due date to encompass federal income tax return filing as well.
However, there are a few nuances surrounding this welcomed relief:
- The extended due date of July 15 for tax payments applies to both tax payments associated with 2019 federal income taxes (including any self-employment taxes) and 1st quarter 2020 tax estimates. However, it does not extend the due date for 2nd quarter 2020 tax estimates, which remains June 15, 2020.
- There is an overall cap on the amount of taxes you can postpone, which is $1 million for individuals and $10 million for corporations. The $1 million for individuals applies regardless of filing status, so both individuals filing Single and individuals filing Married Filing Jointly are limited to the same $1 million cap.
- The delayed payment cap applies to the combined total of 2019 tax due and 2020 1st quarter estimates. Any amount exceeding the cap must be paid by April 15 to avoid any interest/penalties on the excess amount.
- This announcement applies to federal income tax returns and payments only. Each individual state must now determine if they will enact related changes to their 2019 state income tax filing and payment due dates.
- For Oklahoma, Governor Stitt announced on March 19 that the Oklahoma Tax Commission would mirror the extended tax payment deadlines and cap amounts set for federal income tax returns. With the newly extended federal filing deadline, it remains to be seen if Oklahoma will follow suit and extend their filing deadline as well.
Additional tax breaks and payment extensions are still being debated in Congress, so there is a strong possibility that additional tax accommodations will be added in the coming months.
We at Trust Company of Oklahoma will continue to keep you informed as soon as specific plans emerge.