Tax Filing Update & Additional Guidance
March 28, 2020

To Our Valued Clients and Friends,
On March 20, 2020 the Internal Revenue Service (IRS) provided an extension of time to file tax returns typically due on April 15, 2020 for individual, trust and estates, corporations and other non-corporate tax filers under Notice 2020-18. However, as stated with our original correspondence on March 21, 2020 there were a number of outstanding questions regarding the notice. As a result, the IRS has released a set of frequently asked questions that answered the majority of those questions remaining. Below is a summary of the additional guidance provided by the IRS:

Specific Forms Covered

The Notice postpones the filing and payment of Federal income taxes reported on the following forms:

  • Form 1040, 1040-SR, 1040-NR, 1040-NR-EZ, 1040-PR, 1040-SS
  • Form 1041, 1041-N, 1041-QFT
  • Form 1120, 1120-C, 1120-F, 1120-FSC, 1120-H, 1120-L, 1120-ND, 1120-PC, 1120-POL, 1120-REIT, 1120-RIC, 1120-SF
  • Form 8960
  • Form 8991

With respect to tax-exempt filings (Form 990), if that filing was due to be filed on April 15, then it has been postponed to July 15 under the Notice. For taxpayers whose Form 990 is due on May 15, that due date has not been postponed under the Notice.

With respect to business returns historically due on March 16, 2020, which included Form 1065, Form 1065-B, Form 1066, and Form 1120-S for calendar year taxpayers, the filing of those returns has not been postponed.

Obtaining a Full Six Month Extension of Time to File

One issue that was somewhat unclear from Notice 2020-18 was whether a taxpayer who would not be ready to file on July 15, 2020 would still need to file an extension by April 15, 2020. The good news is that the IRS stated that extensions filed by July 15, 2020 will be treated as if it had been filed on or before April 15, 2020.

Second Quarter 2020 Estimated Tax Payment

In Notice 2020-18 it was clear that the deadline for first quarter 2020 estimated income tax payments were postponed from April 15, 2020 to July 15, 2020. Per the additional guidance provided by the IRS the second quarter 2020 estimated income tax payment will remain due on June 15, 2020.

IRAs and Other Retirement Plans

The IRS also pushed back the date allowable for making contributions to IRAs and employer retirement plans. Per the additional guidance, IRA contributions for 2019 can be made until July 15, 2020. In addition, employers will also have until July 15, 2020 to make their contributions.

Health Saving Account (HSA) and Medical Saving Account (MSA) Funding

Taxpayers with HSA and MSA accounts will have until July 15, 2020 to make contributions for 2019.

As a reminder, our office remains closed under the Governor’s directive. However, we are continuing to work and prepare returns remotely as well as answer any tax questions that may arise. We have prepared a link on our website to direct you to information concerning SBA Disaster Loans, questions dealing with Nevada unemployment and Federal payroll tax credits for small businesses. We are here to assist as best as we can during these difficult times. Please feel free to contact us if we can provide any assistance.

Sincerely,

The Clausen & Company Team



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