COVID19 Tax Update
While this is usually Turbo Tax’s busiest week of the season, they may have noticed a decrease in submitted taxes this week. This is due to the fact that the Treasury and IRS, have extended the tax deadline by 90 days in response to the novel coronavirus. The new federal tax filing deadline for this year is now July 15th. While the extension may come as a reprieve for many, taxpayers who are ready to file and make their tax payment without straining their bank account are encouraged to file in order to get their refund as soon as possible. Well, here are some answers to some common questions you might have.
Do I need to file an extension in order to take advantage of the new filing deadline?
No, you do not have to file any extensions or take any action. The new filing deadline of July 15th automatically applies to all taxpayers.
Is there also an extension of the tax payment deadline?
Yes, the new tax payment deadline is also July 15th. You do not need to take any action for this either. This deferment of tax payments is interest fee and penalty free, simply pay by July 15th.
Does this mean I have more time to contribute to my IRA?
Yes, a bonus to the extended due date of taxes is also that you now have until July 15th to contribute to your IRA for 2019.
Will this affect when I get my refund?
No, the Treasury Department will continue processing refunds as soon as your taxes are filed. You should receive your refund within the normal time frame (9 out of 10 refunds are received within 21 days when filed electronically).
What do I do if I already filed my taxes and scheduled my payment for the April 15th deadline?
If you’ve already filed and scheduled your payment, but want to take advantage of the new deadline, you’ll have to cancel your payment and reschedule it. In order for this to go into effect, changes to the payment needs to be made no later than 11:59 p.m. ET, two business days before the scheduled payment date.
What if I need more time then the July 15th deadline to file or pay my taxes?
If you need additional time to file, you will then need to request an extension using Form 4868. This extension will give you until October 15th to file your taxes. However, tax payments need to be made by July 15th. Payments that are made after the July 15th deadline are subject to interest and penalties.
Does the deadline also apply to state taxes?
A majority of states in the country have also extended their due date to the federal July 15th tax deadline. However, some states have created different deadlines and guidelines. It’s important to determine what your state has decided so that you do not unintentionally accrue any penalties.