On March 18, 2020, the IRS issued Notice 2020-17. This notice was the formal guidance that extended the date for making tax payments due April 15, 2020 to July 15, 2020, and this delay is in response to the current Coronavirus (COVID-19) situation.
Treasury Secretary Mnuchin had indicated this delay would be available to taxpayers, and the IRS followed with release today of Notice 2020-17 (please also see our Sikich article released March 17, 2020 that addressed this topic).
Thus, if an individual taxpayer owes $3,000,000 in federal tax for the 2019 year on April 15, 2020, the taxpayer could defer payment of $1,000,000 of this tax until July 15, 2020, but if the remaining $2,000,000 of tax is not paid by April 15, 2020, this $2,000,000 amount will accrue interest and penalties as of April 15, 2020.
Further, many states were waiting for this formal IRS announcement to determine if the state will also offer some delay of tax payments for April 15, 2020. This state guidance may also likely be forthcoming in the next several days. In addition, the IRS may offer updates and clarifications as needed. Please contact your Sikich tax advisor with any questions.
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