In response to coronavirus, the Treasury and IRS have announced several changes to the tax filing season, including an extension of the federal tax filing deadline to July 15, 2020. Taxpayers getting a refund are encouraged to file their taxes now to get their money.
We know that you probably have questions about how Coronavirus (COVID-19) relief and the changes to the tax deadline impact your taxes — don’t worry, we’ve rounded up some of the top tax questions below to help get you the answers you need.
When is the federal tax deadline?
The federal tax filing deadline has been extended to July 15, 2020. As the IRS expects to continue to process refunds as normal, taxpayers who are getting a refund are encouraged to file now to get their money.
Will my refund be delayed?
No, the IRS expects to continue to process refunds as normal and still plans to issue nine out of 10 tax refunds within 21 days or less from acceptance with e-file and direct deposit — the quickest way to get your refund. Last tax season, nearly 72% of taxpayers received a tax refund close to $3,000. For many, this is their largest paycheck of the year and much-needed at a time like this.
Do I need to do anything to be eligible for the July 15 deadline extension? Do I need to file a tax extension?
No, the July 15 federal tax deadline applies to all taxpayers. You don’t need to file any additional forms or call the IRS to qualify. All you have to do is file and pay any tax due, if you owe, by July 15.
Will I get a penalty for paying my taxes after April 15?
The extension of the federal tax filing deadline also applies to tax payments. Taxpayers that owe money can defer federal tax payments, interest free and penalty free until July 15. This deferment applies to all taxpayers, including individuals, trusts and estates, corporations and other non-corporate tax filers as well as those who pay self-employment tax. Taxpayers can defer tax year 2019 federal tax payments regardless of the amount owed. This deferment also applies to tax year 2020 estimated tax payments previously due on April 15, 2020.
Deferment of federal tax payments means that if you owe money on your federal taxes, you will get more time to pay what you owe.
I heard there is a stimulus package, am I eligible for it and will it impact my taxes?
Yesterday, the Senate passed the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), a $2 Trillion coronavirus stimulus bill. The stimulus package, which will now go to the House for passage, currently includes a recovery rebate in the form of a refundable tax credit. If passed, the credit could mean up to $1,200 for individuals and $2,400 for joint taxpayers, plus $500 for qualifying children.
Get the latest information and updates on the CARES Act and what it means for you here.
Will my state taxes have a different tax deadline?
A majority of States will be conforming to the new federal deadline of July 15. However, a few states have differing deadlines and guidance. You can get the latest on tax deadlines and guidance for your state by clicking here.
What’s the deadline to make a contribution to my IRA?
The deadline for making contributions to your Individual Retirement Account (IRA) for 2019 has been extended to July 15, 2020. You can contribute a maximum of $6,000 to an IRA for 2019, plus an extra $1,000 if you are 50 or older.
If you are self-employed, you can contribute to a Simplified Employee Pension (SEP) IRA as much as the lesser of 25% of your net earnings or up to $56,000 for 2019 and your contributions may be tax-deductible as a business expense. You can contribute to your SEP IRA until the October 15 extended deadline.
Does this relief mean I have more time to contribute funds to my HSA or Archer MSA for 2019?
Yes. Contributions may be made to your HSA or Archer MSA any time during the year as long as it’s by the due date for filing your tax return. Given the due date for filing federal income tax returns is now July 15, 2020, you have until then to make contributions to your HSA or Archer MSA.
How can I adhere to shelter in place policies and still get the help I need from a tax expert?
Whether you have a simple tax situation, a more involved tax situation with investments or your own self-employed business, you can access TurboTax Live CPAs and Enrolled Agents on-demand, safely and from the comfort of your own home, to get personalized advice for your unique situation. You can connect live via one-way video to our team of TurboTax Live CPAs and Enrolled Agents (EAs), with an average of 15 years experience to get your questions answered. TurboTax Live CPAs and Enrolled Agents are available in English and Spanish, year-round and can review, sign and file your return for extra reassurance. Our TurboTax Live CPAs and Enrolled Agents are up-to-date on tax laws and are available for unlimited advice and answers throughout your tax preparation process. Also, TurboTax Live doesn’t close its doors on July 15th – customers can get year-round advice.
Has the 2020 Quarterly estimated tax deadline been moved?
While the notice postpones the deadline for first quarter 2020 estimated income tax payments from April 15 to July 15, 2020, second quarter 2020 estimated tax payments are still due on June 15, 2020.
One little-known tip for Self-Employed taxpayers is that you can annualize your income. By annualizing, you can recognize your income in the specific quarters you receive it and annualize at the time of filing so you don’t get penalties if your self-employment income was not earned evenly over quarters.
I already scheduled my tax payment for April 15th, can I move it to July 15?
Yes, you can cancel your payment and reschedule it for July 15. For information on how to do that, check out our post here.
What should I do if I’m unable to file my 2019 tax return by the July 15 deadline?
If you can’t file by the July 15 deadline, you can request an automatic extension to file your federal income tax return until October 15. Reminder, a tax extension does not extend the deadline to pay any taxes that you may owe to the IRS. Any tax payments will still be due on July 15.
We’ve Got You Covered
You can be confident that TurboTax is ready to help you stay informed and file now up until the extended July 15, 2020 federal deadline. Additionally, our team of credentialed TurboTax Live CPAs and EAs are available on demand to help you out should you have any questions along the way. Remember to keep checking back here for the most up to date tax information and changes in response to COVID-19.