Treasury Secretary Steven Mnuchin says the Trump administration has decided to push the income tax filing date to July 15 from April 15.
What We Know:
- The administration used authority under Trump’s national emergency declaration. The delay is available to people who owe $1 million or less and corporations that owe $10 million or less.
- It’s the second tax delay that the federal government has announced because of the outbreak, with the Treasury Department earlier giving taxpayers an additional three months to pay the IRS in case they owed taxes, a move that Mnuchin said would leave $300 billion in the economy at a critical time.
At @realDonaldTrump’s direction, we are moving Tax Day from April 15 to July 15. All taxpayers and businesses will have this additional time to file and make payments without interest or penalties.
— Steven Mnuchin (@stevenmnuchin1) March 20, 2020
- The decision comes amid growing concern from lawmakers and consumers about meeting the April 15 tax deadline. On March 10, members of the House Ways Means Committee asked the IRS in a letter to consider extending the filing deadline because “we are concerned about the ability of the IRS to provide taxpayer assistance and process returns, as well as the ability of taxpayers, free tax preparation sites and tax professionals to meet the filing deadline”.
- Mnuchin tweeted that taxpayers who expect refunds should “file now to get your money”. Bill Smith, managing director at the national tax office at financial services firm CBIZ, said he would also advise taxpayers to complete their taxes as quickly as possible. If you owe money, he added, it’s better to know now and plan for those payments rather than wait until July 15.
- According to the latest government data available, as of March 13, the IRS has received more than 76 million returns and has issued more than 59.2 million refunds. The average refund check was $2,973.
- It’s not the first time the tax filing deadline has been extended. It also occurred two years ago when the IRS’ payment website suffered multiple outages hours before the deadline.
- The IRS is reportedly going to increase pressure to have states align with the new federal guideline, it is important for people to check with their local government to make sure they do not miss their obligation in their state.
“Each state may consider it’s own relief, but it’s best to assume you still must file and pay any states where taxes are owed by April 15, unless state guidance is issued,” – Dina Pyron, financial services partner and global TaxChat leader at Ernst & Young
The administration is working with Congress to develop a $1 trillion support package and Mnuchin has said the IRS payment delay will add $300 billion to that effort.