Federal
With less than a month left until the income tax filing deadline of April 15, the Internal Revenue Service (IRS) has automatically extended the filing and payment deadline until May 17 for individual income tax returns this year.
This year’s tax season has been delayed from the start when the IRS began accepting tax returns on February 12, two weeks later than usual. During the pandemic, the IRS has been dealing with a backlog of processing returns, staffing issues, and outdated technology, while it attempts to implement the sweeping tax code changes from recent tax relief packages. In addition, the IRS is attempting to expedite stimulus payments to taxpayers. The extended deadline may allow some breathing room for the overstressed agency.
The deadline extension applies only to individual taxpayers. No interest, penalty, or addition to tax for failure to file a federal income tax return or to pay federal income taxes will accrue between April 15, 2021 and May 17, 2021 for any return or payment postponed by the announcement.
The extended deadline does not apply to estimated income tax payments due April 15, 2021 for 2021 tax years.
Other States
Prior to this announcement of the federal extension, the Maryland Comptroller announced that the deadline for filing state income tax returns is extended until July 15, 2021, during which time no penalties or interest will accrue. This extension applies to individual, pass-through, fiduciary, and corporate income tax returns, including first and second quarter estimated tax payments. In addition, any sales and use tax returns for sales during March, April, and May of 2021 will now be due on July 15, 2021, with no interest or penalties accruing.
In addition to Maryland, California, Oregon, and Utah announced they will extend the due dates for individual returns.
Alabama, Colorado, Illinois, Kansas, Kentucky, Maine, Missouri, Montana, Pennsylvania, West Virginia, and Wisconsin announced Thursday, March 18, 2021 they would extend the due date of individual returns to May 17.
Oklahoma, Louisiana, and Texas have also issued extensions for filing tax returns to June 15, but these extensions were due to the extensive weather and power outage problems last month. It is expected that most of the remaining states will conform with the federal extension, as the federal return acts as the starting point for determining liability in most states.
TECHNICAL INFORMATION CONTACTS:
Mark L. Nachbar
Principal
Ryan
630.515.0477
mark.nachbar@ryan.com
Mary Bernard
Manager
Ryan
401.272.3363
mary.bernard@ryan.com
The material presented in this communication is intended to provide general information only and should solely be seen as broad guidance and not directed to the particular facts or circumstances of any individual who may read this publication. No liability is accepted for acts or omissions taken in reliance upon the content of this piece. Before taking (or not taking) any action, readers should seek professional advice specific to their situation from Ryan, LLC or other tax professionals. For additional information about this topic, please contact us at info@ryan.com.