Treasury Secretary Steven Mnuchin announced this week that taxpayers may get a bit of relief due to the Coronavirus issue affecting the Nation. Mnuchin declared a 90-day deferral of taxes owed with no interest or penalties . While this provides for some relief due to the COVID-19 issue, it’s important to keep in mind that the filing deadline for individual and C corporation returns is still April 15th. The deferral is only for the payment of taxes for 90 days (July 15th), not a filing delay. While other states have followed the IRS’ lead, Illinois has not announced its position on this payment relief as of March 19th. If not changed, an individual’s and corporation’s Illinois tax will still need to paid by April 15th. We’ll keep you updated on this Illinois situation.
The IRS and Treasury Department released Notice 2020-17 on March 19th to better explain what payments can be deferred. We have highlighted a few key components of this information:
- Individuals can defer up to $1 million in income tax payments due on April 15th
- C corporations and consolidated C corp groups may defer up to $10 million in tax payments due on April 15th
- Only income taxes and self employment taxes on self employment income can be deferred
- The extensions also apply to first quarter estimated payments for individuals and C Corporations due April 15th
- The extensions do not apply to payroll deposits
- The extensions do not apply to the second quarter estimates as they are due on June 15th
The IRS and Treasury Department will provide more guidance as needed. Our team will keep you advised as more information comes in. Please contact us if you have any questions or concerns.