Your Top Tax Questions About Coronavirus (COVID-19), Answered

In response to coronavirus, the Treasury and IRS have announced several changes to the tax filing season, including an extension of the tax year 2020 federal tax filing deadline to May 17, 2021. 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 May 17, 2021. 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 May 17 tax deadline extension? Do I need to file a tax extension?

No, the May 17 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 May 17. 

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 May 17. 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 2020 federal tax payments regardless of the amount owed. This deferment does not apply to tax year 2021 estimated tax payments previously due on April 15, 2021. Tax year 2021 first and second estimated tax payments are still due on the original due dates (April 15 and June 15 respectively).

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?

The latest stimulus package, the American Rescue Plan, was signed into law on March 11, 2021. The plan includes a third round of stimulus payments for millions of people. In addition, the bill also extends certain unemployment benefits and expands tax relief for unemployment benefits, the Child Tax Credit, and the federal Earned Income Tax Credit (EITC).  

Get the latest information and updates on the American Rescue Plan and what it means for you — including information on how much stimulus money you are eligible to receive and how long it will take to receive your stimulus check — here.

The Coronavirus Response and Relief Supplemental Appropriations Act of 2021 – a $900B relief package to deliver the second round of economic stimulus for individuals, families, and businesses was signed into law December 27, 2020 and is the second stimulus relief package. The bill provides relief through multiple measures and expands many of the provisions already put into place under the CARES Act, including a second round of direct stimulus payments to individuals and families.

The Coronavirus Aid, Relief and Economic Security Act (CARES) — a $2 trillion stimulus package to provide financial relief to individuals, families, and businesses and the first stimulus package — was signed into law on March 27, 2020. The 2020 coronavirus stimulus package delivered relief through a range of measures, including an advanced tax rebate for taxpayers.

If you didn’t receive the first and second round of stimulus or you received partial payment and you are eligible, you can claim the stimulus payments in the form of a recovery rebate credit when you file your 2020 taxes. TurboTax has proactive guidance and will help you claim the recovery rebate credit if you are eligible.

Will my state taxes have a different tax deadline?

Many state tax deadlines will likely also change to May 17th. However, a few states have different 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 to make contributions to your Individual Retirement Account (IRA) for 2020 has also been extended to May 17th. You can contribute a maximum of $6,000 to an IRA for 2020, plus an extra $1,000 if you are 50 or older and make an impact on your 2020 taxes.

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 $57,000 for 2020 and your contributions may be tax-deductible as a business expense. You can contribute to your SEP IRA until the October 15 deadline.

Does this relief mean I have more time to contribute funds to my HSA or Archer MSA for 2020?

Typically you can make a contribution 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. The IRS has provided guidance that the deadline to make contributions to your HSA or Archer MSA has been extended to May 17th as well.

How can I get the help I need from a tax expert without leaving home?

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 tax experts 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 tax experts, with an average of 12 years experience to get your questions answered. TurboTax Live tax experts are available in English and Spanish, year-round and can review, sign and file your return or new this year, you can fully hand over your taxes from start to finish. Our TurboTax Live tax experts 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 May 17th – customers can get year-round advice.

Has the 2020 Quarterly Estimated Tax Deadline been moved?

The regular tax filing deadline for self-employed was extended to May 17th, but the 2021 quarterly estimated tax deadlines remain the same (April 15, 2021, June 15, 2021, September 15, 2021, and January 18, 2022).

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?

If you have already filed and scheduled your federal tax payment for April 15, you will need to cancel your payment and reschedule it. If you filed with TurboTax, you will need to contact the U.S. Treasury Financial Agent at 888-353-4537 to make that change. Changes to payments need to be made no later than 11:59 p.m. ET two business days prior to the scheduled payment date.

For tax payments scheduled for your state, you will need to contact your state Department of Revenue to see what options are available to you.

What should I do if I’m unable to file my 2020 tax return by the May 17 deadline? 

If you can’t file by the May 17 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 May 17.

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 May 17, 2021 federal deadline. Additionally, our team of credentialed TurboTax Live tax experts are available on demand to help you out should you have any questions along the way or new this year, you can fully hand your taxes over to them from the comfort of your home. Remember to keep checking back here for the most up to date tax information and changes in response to COVID-19.