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 $1,200.
However, if you receive these benefits and also have dependent children under the age of 17, you may qualify for an additional payment of $500 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 500-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 $12,200 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. However, 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
Scams Related to COVID-19 and Economic Impact Payments
The impacts of the COVID-19 (coronavirus) pandemic have caused economic hardship and uncertainty for millions of Americans. Unfortunately, scammers constantly seek new ways to target those in need. The IRS has, therefore, warned all Americans to stay alert for a rash of fraudulent calls, emails, and text messages associated with the coronavirus.
Many of these scams relate to the Economic Impact Payments (EIPs, or stimulus checks) many Americans are receiving from the IRS during the crisis. The scammers often claim to be able to help people receive their stimulus payments more quickly.
The IRS urges all potential EIP recipients to be especially vigilant for unsolicited calls or messages that supposedly come from the IRS, as well as fraudulent websites and social media posts that ask for money or request your personal information. No one from the IRS will reach out to taxpayers in these ways. Instead, you can always find accurate information at irs.gov.
As a reminder, EIPs are being sent automatically to eligible Americans, including many people like retirees and recipients of VA benefits who are not required to file federal tax returns. In the vast majority of cases, you do not need to take any action to receive your payment. If the IRS has put banking information, the payment will be deposited directly to your account. Otherwise, a check will be mailed to you.
According to IRS investigators, scammers might:
- Ask you to sign over your "stimulus" check to them in exchange for some service. The safest way to handle an EIP check is to deposit it directly to your own bank account.
- Ask you to verify your personal or banking information by phone, email, text message, social media message/post, or through an impostor website. Scammers may claim that giving them this information will speed up the process of receiving your EIP, which is not true.
- Claim that they can get your EIP more quickly for you by representing you, in exchange for a fee or access to your private data. You do NOT need a representative to receive your EIP.
- Mail you a fake check, and then ask you to provide your personal information in order to cash it. Depositing an authentic EIP check will not require such action on your part.
If you have not yet received your EIP and wish to provide direct deposit information to the IRS, you should ONLY do so by using either the official IRS Get My Payment portal (if you filed a 2018 or 2019 federal tax return) or the Non-filers: Enter Payment Info Here tool. Note that both of these websites have addresses beginning with irs.gov, and your browser should confirm that the site you are visiting is secure (usually by displaying a padlock icon next to the web address).
Under no circumstances should you provide your direct deposit or any other private information to any other website, or to anyone who contacts you in any manner and claims to represent the IRS. If the IRS needs to contact you about your EIP or any other matter, you will receive a letter on official IRS/U.S. Treasury letterhead.
Posted on June 1, 2020
Upcoming Tax Deadlines
- 10 Employees Who Work for Tips — If you received $20 or more in tips during May, report them to your employer. You can use Form 4070.
- 15 Employers — Nonpayroll withholding. If the monthly deposit rule applies, deposit the tax for payments made in May.
- 15 Employers — Social security, Medicare, and withheld income tax. If the monthly deposit rule applies, deposit the tax for payments made in May.
- 10 Employees Who Work for Tips — If you received $20 or more in tips during June, report them to your employer. You can use Form 4070.
- 15 Corporations — Deposit the first installment of estimated income tax for 2020. A worksheet, Form 1120-W, is available to help you estimate your tax for the year.
- 15 Corporations — Deposit the second installment of estimated income tax for 2020. A worksheet, Form 1120-W, is available to help you estimate your tax for the year.
- 15 Corporations — File a 2019 calendar year income tax return (Form 1120) and pay any tax due.
- 15 Individuals — If you're a U.S. citizen or resident alien living and working (or on military duty) outside the United States and Puerto Rico, file Form 1040 or Form 1040-SR and pay any tax, interest, and penalties due. If you want additional time to file your return, file Form 4868 to obtain additional time to file and pay what you estimate you owe in tax to avoid penalties and interest. Then, file Form 1040 or Form 1040-SR by October 15. However, if you're a participant in a combat zone, you may be able to further extend the filing deadline.
- 15 Individuals — File a 2019 Form 1040 or Form 1040-SR and pay any tax due.
- 15 Individuals — If you're not paying your 2020 income tax through withholding (or won't pay in enough tax during the year that way), pay the first installment of your 2020 estimated tax.
- 15 Individuals — Make a payment of your 2020 estimated tax if you're not paying your income tax for the year through withholding (or won't pay in enough tax that way). Use Form 1040-ES. This is the second installment date for estimated tax in 2020.
- 15 Employers — Nonpayroll withholding. If the monthly deposit rule applies, deposit the tax for payments made in June.
- 15 Employers — Social security, Medicare, and withheld income tax. If the monthly deposit rule applies, deposit the tax for payments made in June.
- 31 Certain Small Employers — Deposit any undeposited tax if your tax liability is $2,500 or more for 2020 but less than $2,500 for the second quarter.
- 31 Employers — Deposit the tax owed through June if more than $500.
- 31 Employers — If you maintain an employee benefit plan, such as a pension, profit-sharing, or stock bonus plan, file Form 5500 or 5500-EZ for calendar year 2019. If you use a fiscal year as your plan year, file the form by the last day of the seventh month after the plan year ends.
- 31 Employers — Social security, Medicare, and withheld income tax. File Form 941 for the second quarter of 2020. Deposit or pay any undeposited tax under the accuracy of deposit rules. If your tax liability is less than $2,500, you can pay it in full with a timely filed return. If you deposited the tax for the quarter timely, properly, and in full, you have until August 10 to file the return.
- 10 Employees Who Work for Tips — If you received $20 or more in tips during July, report them to your employer. You can use Form 4070.
- 10 Employers — Social security, Medicare, and withheld income tax. File Form 941 for the second quarter of 2020. This due date applies only if you deposited the tax for the quarter timely, properly, and in full.
- 17 Employers — Nonpayroll withholding. If the monthly deposit rule applies, deposit the tax for payments made in July.
- 17 Employers — Social security, Medicare, and withheld income tax. If the monthly deposit rule applies, deposit the tax for payments made in July.