Tax Deferral in Response to the COVID-19 Pandemic

On March 13th, President Trump declared the COVID-19 pandemic a national emergency and directed the U.S. Treasury to provide relief from tax deadlines to Americans who have been adversely affected by the emergency.

Federal Tax Filing and Payment Deferral

Pursuant to the emergency declaration, the I.R.S. issued Notice 2020-18 on Friday. The Notice provides for an automatic three-month extension of time to file and to pay any federal tax otherwise due on April 15th, 2020 to July 15th, 2020 for an individual, trust, estate, partnership, association, company, or corporation.

These taxpayers do not have to file any specific forms to extend, and there is no limit to the amount of the payment that may be postponed. The relief provided by Notice 2020-18 is available solely for federal income tax payments (including payments of tax on self-employment income) and federal income tax returns due on April 15th, 2020, in respect of a taxpayer’s 2019 tax year, and federal estimated income tax payments (including payments of tax on self-employment income) due on April 15th, 2020, for a taxpayer’s 2020 tax year. The Notice does not specifically address second quarter estimated tax payments, which are due on June 15th, so unless and until additional guidance is issued the deadline for these payments should be assumed to be unchanged. Also, the Notice does not address taxpayers that will need additional time to file beyond the extended filing deadline of July 15th, 2020. Presumably, an extension to October 15th, 2020 will be available, but we await further guidance from the I.R.S. on this matter.

The States

Many states have already stated that they intend to follow suit, and others are likely to do so over the coming days and weeks. Some states are also offering relief for sales, use, and various other state-level taxes. We are staying on top of state-level developments and will provide specific guidance to our clients for whom we prepare their state tax filings.

Refunds

Treasury Secretary Mnuchin stated in a press briefing on Tuesday that refunds will not be affected and urged those who are owed a refund to file as soon as possible to claim their refund.

We are monitoring this situation and will continue to report on developments as they occur.

 

Your Pathstone Team

Disclosure: This presentation and its content are for informational and educational purposes only and should not be used as the basis for any investment decision. The information contained herein is based on publicly available sources believed to be reliable but is not a representation, expressed or implied, as to its accuracy, completeness or correctness. No information available through this communication is intended or should be construed as any advice, recommendation or endorsement from us as to any legal, tax, investment or other matters, nor shall be considered a solicitation or offer to buy or sell any security, future, option or other financial instrument or to offer or provide any investment advice or service to any person in any jurisdiction. Nothing contained in this communication constitutes investment advice or offers any opinion with respect to the suitability of any security, and this communication has no regard to the specific investment objectives, financial situation and particular needs of any specific recipient. Past performance is no guarantee of future results. Additional information and disclosure on Pathstone is available via our Form ADV, Part 2A, which is available upon request or at www.adviserinfo.sec.gov. Any tax advice contained herein, including attachments, is not intended or written to be used, and cannot be used, by a taxpayer for the purpose of (i) avoiding tax penalties that may be imposed on the taxpayer or (ii) promoting, marketing or recommending to another party any transaction or matter addressed herein.

Offices

Scottsdale, AZ

Contact & Locations

Los Angeles, CA

Contact & Locations

Lakewood, CO

Contact & Locations

Alexandria, VA

Contact & Locations

Maryland

Contact & Locations

Naples, FL

Contact & Locations
Street view of Winter Park Florida Pathstone Office

Winter Park, FL

Contact & Locations

Atlanta, GA

Contact & Locations

Boston, MA

Contact & Locations

Englewood, NJ

Contact & Locations
Aerial view of New York City

New York, NY

Contact & Locations

Providence, RI

Contact & Locations

Austin, TX

Contact & Locations

Bellevue, WA

Contact & Locations

Seattle, WA

Contact & Locations