IRS significantly expands tax return filing and payment due date relief

On April 9, 2020, the IRS and Treasury Department issued Notice 2020-23, granting an automatic extension until July 15, 2020, to comply with several federal filing and payment obligations in addition to those already extended, as well as to perform certain time-sensitive actions. The relief generally applies to all obligations that otherwise would have been due on or after April 1, 2020, and before July 15, 2020, including 2020 second-quarter estimated tax payments. It also extends to both calendar-year and fiscal-year filers.

The notice clarifies “all schedules, returns, and other forms” that must be attached to the returns that are automatically extended are covered (such as Schedules H and SE, and Forms 3520, 5471, 5472, 8621, 8858, 8865 and 8938). This relief includes any installment payments of repatriation tax liabilities due on or after April 1, 2020, and before July 15, 2020. In addition, elections that are made or required to be made on a timely filed covered return are extended as well.

This relief is automatic: affected taxpayers do not have to call the IRS, file extension forms, or send letters or other documents to receive this extension. Taxpayers may continue to file for additional extensions beyond July 15, 2020, but the extension date may not go beyond the original statutory or regulatory extension date. For example, a request for an extension to file an individual tax return may be filed by July 15, 2020, to extend the time to file the return, but that extension will only be to Oct. 15, 2020. It will not extend the time to pay federal income tax beyond July 15, 2020.

Caution: This relief applies to federal obligations only. Each state will have its own deadlines.

Tax returns and payments covered by the notice include, but are not limited to:

  • Individual income tax payments and filings on Forms 1040, 1040-SR and 1040-NR,
  • Calendar- or fiscal-year corporate income tax payments and filings on Form 1120, 1120-S, 1120-C, 1120-F, 1120-RIC and 1120-REIT,
  • Calendar- or fiscal-year partnership return filings on Form 1065,
  • Estate and trust income tax payments and return filings on Form 1041,
  • Estate and generation-skipping transfer tax payments and return filings on Form 706,
  • Gift and generation-skipping transfer tax payments and return filings on Form 709,
  • Exempt organization business income tax and other payments and return filings on Form 990-T, and
  • Excise tax payments on investment income and return filings on Form 990-PF.

Time-sensitive taxpayer actions extended include:

  • The 180-day period for investing eligible capital gains in a qualified opportunity zone,
  • Filing a petition with the Tax Court, or for review of a decision rendered by the Tax Court,
  • Filing a claim for credit or refund of any tax, and
  • Bringing suit upon a claim or refund of any tax.

This relief is limited to the items specifically provided for by the notice and other official guidance released to date. Any other type of federal tax, return or time-sensitive act has not been extended. For example, Form 8752, where fiscal-year partnerships and S corporations make deferral period deposits, is not covered by the notice since it is not an income tax. It is also not filed as an attachment to or by the due date of any of the above-mentioned forms. We are not certain if this is an oversight and will provide an update if Treasury issues any guidance regarding this filing.

Thanks to Baker Tilly CPAs for this information.