On Monday, June 29, the Department of Treasury and IRS announced that the tax deadline would not be pushed back. In March, the IRS extended the April 15 tax deadline to July 15. As recently as last week, however, Treasury Secretary Steve Mnuchin left the door open for an additional filing and/or payment extension. That apparently won’t happen now. Many taxpayers were hoping that the payment date would be pushed back until next year, given the current conditions. Although the IRS acknowledged that COVID-19 has adversely impacted many taxpayers, they strongly encouraged those who have not filed to do so soon.
Tax Filing Options
If you need more time to prepare and/or file your tax return, you can still request an extension. This pushes the filing deadline to October 15, 2020. Simply complete Form 4868, Application for Automatic Extension of Time to File U.S. Individual Income Tax Return. Keep in mind that you must estimate how much you will owe (if applicable) and pay any amount due when submitting the extension request. Submit the form before the July 15 tax deadline.
Another option is to make a partial of full payment of the tax amount owed by using Direct Pay, the Electronic Federal Tax Payment System (EFTPS), or credit or debit card. If you indicate that the payment is for an extension, you are not required to submit Form 4868. The IRS will provide a confirmation number as proof of your payment and extension request.
Tax Payment Options
Thanks to the coronavirus, taxpayers are struggling to make ends meet. Millions have been laid off or furloughed. Many of those who have retained their jobs have seen a decrease in hours. If you are among those who are unable to pay by the July 15 tax deadline, don’t panic. You still have options.
- Online Payment Agreement — Available if you owe $50,000 or less in combined income tax, penalties and interest. Businesses that owe $25,000 or less in combined payroll tax, penalties and interest are also eligible. You must be current on all tax return filings. Most taxpayers qualify for this option.
- Installment Agreement — If you are not eligible for the online payment agreement option, or choose not to use it, you can also apply for a payment plan (also known as an installment agreement).
- Currently Not Collectible — If the IRS determines that you are unable to pay, it may delay collections until your financial situation improves. Penalties and interest will continue to accrue until your taxes are paid in full.
- Offer in Compromise — Under certain circumstances, you may settle your tax bill for less than the amount you owe. This is done through an Offer in Compromise.
For more information on any of these tax filing and payment options, contact the tax experts at Tax Defense Network (a MoneySolver company) immediately. We offer a free, no-obligation consultation, and can help you find the best solution for your tax situation.