The Treasury Department and Internal Revenue Service announced on March 17 that the federal income tax filing and payment due date for individuals for the 2020 tax year will be automatically extended from April 15, 2021, to May 17, 2021. The Indiana Department of Revenue followed suit on March 22, aligning Indiana’s filing and payment due date with the IRS.
Individual taxpayers do not need to file any forms or call the IRS to qualify for this automatic federal tax filing and payment relief. Individual taxpayers who need additional time to file beyond the May 17 deadline can request a filing extension until Oct. 15 by filing Form 4868. Filing Form 4868 gives taxpayers until October 15 to file their 2020 tax return but does not grant an extension of time to pay taxes due. Taxpayers should pay their federal income tax due by May 17, 2021, to avoid interest and penalties.
This relief does not apply to estimated tax payments that are due on April 15, 2021. These payments are still due on April 15.
This relief also does not apply to any returns or payments other than for 2020 individual income tax. Although Congress has indicated they will continue to consult with the IRS and will monitor IRS activities as the filing season progresses to determine if additional extensions might be necessary, no such extensions have been announced.
While the income tax filing deadline for individuals has been extended until May 17, our recommendation is to continue working toward the tax deadline as if it were still April 15. This enables us to evaluate your tax position more quickly to determine what is most beneficial for you. For those who will receive a refund, we can file your return, so you receive the payment as soon as possible. For those who will owe tax, you can proactively determine the amount and then plan to delay the payment until closer to the deadline.
WINTER STORM DISASTER RELIEF FOR LOUISIANA, OKLAHOMA, AND TEXAS
Earlier this year, following the disaster declarations issued by the Federal Emergency Management Agency (FEMA), the IRS announced special relief for victims of the February winter storms in Texas, Oklahoma, and Louisiana. These states have until June 15, 2021, to file various individual and business tax returns and make tax payments. This extension to May 17 does not affect the June deadline.
Like Indiana, many states will conform to the federal extended deadline of May 17. As always, we will closely monitor state and local legislative changes and market conditions to help our clients effectively navigate these changes and mitigate the financial effects. If you have questions about how this extension affects your situation, please reach out to your Whitinger advisor.
We are here and ready to help.