Additional Guidance on April 15 Extended Payments

March 19, 2020

The IRS released Notice 2020-17, which provides further guidance on the extended payment date for taxes due on April 15, 2020.

This covers both the 2019 tax payment and the 1st quarter estimated tax payment for 2020. The Notice makes clear that, pending further action, return filing deadlines are not extended. 

The Notice specifically provides:

  • Any income and self-employment taxes originally due April 15, 2020, including both 2019 taxes due and the 1st quarter estimated tax payment for 2020, can be paid as late as July 15, 2020, with no interest or penalties.
  • For corporations, the maximum amount that can be deferred is $10,000,000 for each consolidated income tax filing and each C corporation that is not filing as part of a consolidated group.
  • For individuals (whether filing jointly or as a single taxpayer) and other taxpayers (e.g., trusts), the maximum amount that can be deferred is $1,000,000.
  • Amounts in excess of these maximum deferred amounts will need to be paid by April 15, 2020, or incur penalty and interest charges for late payment of taxes.

The Notice only addresses income and self-employment taxes due April 15, 2020.

It is anticipated that future guidance will address income and self-employment tax payments due at other times, including payments for fiscal-year taxpayers and, for calendar-year taxpayers, the 2nd quarter estimated tax payment due June 15, 2020. It is unclear whether the 2nd quarter estimated tax payment will need to be made on June 15, 2020, or whether it can be included as part of an inflated 1st quarter estimated tax payment made July 15, 2020.

Our advice continues to be that to obtain the tax payment extension, individual, trust, and corporate taxpayers must file their tax returns or request extensions by April 15. If you anticipate a refund, we strongly recommend that you file as early as practical.

Cherry Bekaert remains committed to providing you a superior client experience. We continue to work hard and creatively to meet your tax return needs and encourage you to submit your tax information to us as early as you can.

Please note that this is developing news. There will no doubt be more developments and we will keep you updated as they are released. Should you have any questions, please do not hesitate to contact your tax professional team members.

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If you have paper documents that you cannot deliver electronically, we plan to have at least one person in each of our offices to receive mail and packages, as well as to facilitate work between our people and our clients.

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