July 15th, 2020 Filing & Payment Deadline Approaching
In response to the COVID-19 (coronavirus) pandemic and the National Emergency declaration, the IRS and U.S. Treasury moved the deadline for filing 2019 federal tax returns and paying any tax due from April 15 to July 15, 2020. The deadline change allows taxpayers to defer paying the balance due on their 2019 taxes until July 15, without incurring penalties or interest charges.
This deadline extension is automatically granted to all U.S taxpayers, including individuals (both employees and self-employed), corporations, small businesses, and estates and trusts. You do not need to file any forms or call the IRS to receive this automatic extension.
However, the IRS urges all taxpayers who may be owed a 2019 federal tax refund to file their returns as soon as possible so that the refund can be issued. Filing electronically and requesting direct deposit is the fastest way to get your refund. In spite of some service reductions due to the coronavirus, the IRS is still able to issue most refunds within 21 days of receiving an electronic filing.
If you cannot file your return by the July 15 deadline, you may request additional time by filing Form 4868 (Form 7004 for businesses). Submitting this request will generally result in an automatic filing extension until October 15. Note. however, that this extension applies only to filing returns, not to making payments. Therefore, to avoid interest charges and/or penalties, you should estimate the amount of tax you owe and pay that amount by July 15 if at all possible.
In addition to the April 15, 2019, filing and payment deadline, other IRS deadlines between April 1 and July 15 were extended to July 15, 2020. The deadlines for both first- and second-quarter estimated tax payments (ordinarily April 15 and June 15) were moved to July 15. If you pay estimated taxes, you may make these two payments at any time up until July 15 without penalty.
The deadline extension from April 15 to July 15 also applies to filing for unclaimed federal tax refunds from 2016.
If you have not yet made an appointment to speak about filing your taxes, you should do so right away.
Posted on June 1, 2020
IRS Economic Impact Payments — Veterans and Social Security/SSI Recipients Receiving Automatic Payments
The IRS is continuing to send COVID-19 Economic Impact Payments (EIPs, also called stimulus payments) to millions of Americans weekly. The vast majority of eligible recipients will get their EIPs automatically without taking any action. However, some people will need to complete a few simple steps in order to receive the full payment to which they are entitled.
If any of the following apply to you, you should receive your EIP automatically:
- You filed a 2018 or 2019 federal income tax return
- You receive Social Security retirement or disability benefits
- You receive Railroad Retirement benefits
- You receive Supplemental Security Income (SSI) benefits
- You receive Veterans Affairs (VA) benefits
If you filed a 2018 or 2019 federal return and provided direct deposit information to receive your refund, your EIP will be automatically deposited to that bank account. Otherwise, you will receive a check in the mail. If you have not yet received your EIP and wish to provide the IRS with direct deposit information, you can do so by using the Get My Payment portal, which is now available in both an English version and a Spanish version.
If you receive Social Security, Railroad Retirement, SSI or VA benefits, your EIP will come to you in the same way as your regular benefits payments, such as through direct deposit or as a mailed check. Note that the payment will come from the U.S. Treasury, not your normal benefits provider. In most cases, individuals who receive any of these benefit types and are not required to file federal tax returns will receive an EIP of 51,200.
However, if you receive these benefits and also have dependent children under the age of 17, you may qualify for an additional payment of 5500 per child. In order to claim this additional benefit, you may need to register your children using the IRS Non-filers: Enter Payment Info Here portal. The deadline to register and have the 5500-per-child payment added to your EIP has passed, but you may still receive the supplemental payment at a later date, or be able to claim a refundable credit for the additional amount by filing a 2020 tax return.
The EIP portal for non-filers is especially important for those who do not receive any of the above benefits and are not required to file federal returns due to low income (typically, below $24.400 for couples or $12200 for individuals in 2019). If these circumstances apply to you, the IRS likely does not have sufficient information to send you an EIP. You should enter your information using the EIP portal for non-filers as soon as possible. Like the Get My Payment portal, this portal is available in English and Spanish versions.
As a reminder, ElPs are NOT taxable income, so you will not need to report your payment on your 2020 federal, state or local tax returns.
Posted on June 1, 2020
Why Your Economic Impact Payment (EIP) Amount May Be Different Than You Expected
Throughout April and May, the IRS delivered well over 100 million Economic Impact Payments (EIPs, also called stimulus payments) to Americans. It was widely publicized that many individual taxpayers would receive EIPs in the amount of $1,200, with an additional payment of $500 per qualifying child. How ever, the size of each payment depended on a person's income, family circumstances, and other factors. If your EIP amount was different than you expected, it may have been for one or more of these reasons:
- Your adjusted gross income (AGI) may be higher than the limit to receive the maximum EIP amount. For example, single filers with an AGI above $75,000 receive a reduced EIP, with the amount decreasing to $0 for those with AGIs of $99,000 or more. Joint filers with AGIs above $150,000 also receive reduced EIPs, or no EIP if their AGI exceeds $198,000.
- Your 2018 tax return was used because you have not filed your 2019 return, or the IRS has not yet processed your 2019 return. If you have not filed your 2019 federal tax return yet, your EIP amount may have been calculated based on the AGI and family size shown on your 2018 return, which may differ from your 2019 information. Your 2018 return may also have been used if you filed your 2019 return very recently, or the IRS found an issue with your 2019 return that has delayed processing.
- Your dependents may not qualify for the additional $500-per-child payment. To be eligible for the additional payment, dependent children generally must live with you for more than half the year and be related to you (including by adoption or foster care). Each child must also have been under the age of 17 at the end of the tax year that the IRS used to calculate your EIP (either 2018 or 2019), and have a Social Security Number (SSN) or Adoption Taxpayer Identification Number (ATIN).
- Your payment may have been reduced due to payments you owe, such as past-due child support or other debts. In the event of a reduction due to child support owed, you should receive a notice from the Bureau of the Fiscal Service explaining the reduction. For all other debts, creditors can only gain access to your EIP after it is deposited into your bank account, so your bank records should show the deduction.
If you were entitled to a larger EIP than the one you actually received (for example, if you had a child in 2019 but have not yet filed your 2019 federal tax return), you may be able to claim a credit on your 2020 tax return for any additional amount you are owed.
Unfortunately, because EIPs were sent based on 2018 and 2019 tax returns, many Americans have received checks made out to relatives who are deceased. The IRS has stated that these payments must be returned. The easiest way to return such a payment is to write "VOID" in the endorsement area on the back of the check and mail it to the nearest IRS Service Center (addresses available at irs.gov), with a note explaining why you are returning it.
Posted on June 1, 2020