With the release of Notice 2020-18, the IRS has now expanded the limited relief it previously granted three days ago in Notice 2020-17 with respect to Federal income tax payments (including payments of tax on self-employment income) due on April 15, 2020:
- First, the due date for filing a Federal income tax return due on April 15, 2020 is now automatically postponed to July 15, 2020. Taxpayers do not have to file any extension form (such as IRS Form 4868 or Form 7004) in order to benefit from this postponement.
- Second, Notice 2020-18 eliminates the caps on the amount of Federal income tax payments (including payments of tax on self-employment income) that are permitted to be deferred from April 15, 2020 to July 15, 2020. There is now no limitation on the amount of Federal income tax payments that can be so deferred.
As a reminder, the Senate Republican Phase 3 Stimulus Proposal would expand the relief given to taxpayers even beyond that provided by Notice 2020-18, which we have summarized here.
Three other points that taxpayers should keep in mind. First, the relief provided by the IRS in Notice 2020-18 applies only to Federal income tax payments (including payments of tax on self-employment income) and returns; it does not apply to any other type of Federal taxes (such as employer payroll taxes). Second, the payment deferral provision does not apply to payments otherwise due on any date other that April 15, 2020. Third, although some states have begun to provide similar relief to their taxpayers, not all states have yet done so, and the relief granted varies by state. Taxpayers should check to see what, if any, relief has been granted by the states in which they are required to file tax returns and/or pay taxes.