In response to the ongoing coronavirus pandemic, President Donald Trump issued an emergency declaration instructing the Secretary of the Treasury “to provide relief from tax deadlines to Americans who have been adversely affected by the COVID-19 emergency, as appropriate, pursuant to 26 USC. 7508A(a).”
Consistent with the President’s instruction, last week, the IRS issued guidance extending the due date for filing income tax returns and making income tax from April 15 to July 15. As a result, all taxpayers will automatically have additional time to file and make tax payments without accruing interest or penalties. The income tax extension applies to all taxpayers, including individuals, trusts and estates, corporations and other non-corporate tax filers as well as those who pay self-employment tax. Furthermore, the extension covers both 2019 income tax returns and estimated income taxes for the first quarter of 2020, and there is no cap on the amount of income taxes that can be deferred.
Similarly, the Arizona Department of Revenue announced that the deadline for filing and paying state income taxes is extended to July 15, 2020. Taxpayers filing state income tax returns or submitting payments before July 15, 2020, will not be assessed late filing or late payment penalties. The announcement by the Arizona Department of Revenue includes individual, corporate, and fiduciary income tax returns.
Neither notice states whether a taxpayer seeking the standard six-month extension will have to file by October 15, 2020 (the normal 6-month extension period) or by January 15, 2021 (six months from the extended July 15, 2020 filing deadline).
With respect to gift tax returns, there is no change to the regular filing and payment deadlines (i.e., they are not moved to July 15th). In this regard, absent further guidance from Treasury, we believe it prudent to have your tax preparer complete and file by April 15, 2020 a Federal Form 8892 (instead of relying on Federal Form 4868) as to any 2019 gift tax returns that will not be filed by April 15, 2020.