While more robust government support may still be a ways away, changes to tax deadlines and payments offer an avenue for immediate support to small business owners in the face of the COVID-19 crisis. With so many changes, here is a simple, straightforward look at what you need to know about extended tax deadlines and payment changes.
Federal Tax Deadline Extended to July 15, 2020
The Internal Revenue Service (IRS) has extended the federal tax filing deadline for 2019 from April 15 until July 15, 2020. That extension means that individuals and businesses now have an additional 3 months to file taxes.
Federal Extended Payment Deadline
If an individual or business owes $10 million or less in taxes for 2019, the payment date has also been extended until July 15, 2020.
Does This Affect Estimated Tax Payments for 2020?
Estimated tax payments for small businesses and self-employed individuals also fall under the extension. Estimated quarterly taxes for the first quarter that would have been due on April 15, 2020, are now due on July 15, 2020.
Does This Mean You Don’t Have to File or Pay Anything by April 15, 2020?
That depends on your state. The changes above apply to federal tax filing and payments, but you should check with your state tax agency to see if they’ve extended deadlines as well.
Does This Mean You Don’t Owe Taxes for 2019?
These changes are designed to ease the immediate financial burden for individuals and small businesses. They do not change the amounts due for 2019, so the taxes you owe will remain unchanged.
Will This Affect Your Refund?
The changes should not affect tax refunds. According to the Treasury Department, refunds should still be received within the standard time period, which is within 21 days of filing for most.
What If Your Business Isn’t Ready to File?
Sunrise has a set of free tools to help you including a tax filing checklist, common and overlooked deductibles, 1099s management, depreciation, and more. You can access it for free here.
The information provided in this post does not, and is not intended to, constitute tax advice; instead, all information, content, and materials available in this post are for general informational purposes only. Readers of this post should contact their tax professional to obtain advice with respect to any particular tax matter.