The IRS has made some changes to filing rules for the upcoming April 15 deadline. Here’s what’s different and what’s staying the same.

Key Takeaways:

  • The IRS has announced that U.S. taxpayers can put off filing their federal income tax returns and paying their federal income tax bills for 2019 until July 15.
  • IRA contributions for 2019 can also be made by July 15.
  • Note: This information is current as of March 24, 2020. There are various legislative proposals and negotiations underway that may expand the relief provided to taxpayers.  This article will be updated as new information is released.  Be sure to speak with your tax advisors before taking any action.

 

Relief for U.S. taxpayers: the IRS will allow individuals to defer filing 2019 federal income tax returns and paying federal income tax bills that would normally be due on April 15 until July 15 without interest or penalties. This includes outstanding 2019 tax payments and any 2020 estimated quarterly tax payments due by April 15. This deferral also applies to trusts, estates, partnerships, and corporations.

The deadline for contributions to individual retirement accounts (IRAs) has also changed: you have until July 15 to make contributions for 2019.

It’s also important to note that state and municipal taxes aren’t affected by this IRS announcement. While some locations (including New York and California) are allowing deferred filings and payments to some extent, you’ll want to check with your state or local government or your tax advisor.

Who should take advantage of this opportunity to defer filing their federal returns and paying their federal taxes?

Those who owe the most to the IRS for the balance of their 2019 taxes, or who owe the most in quarterly estimated tax payments, might benefit the most from waiting until July to file and make their payments.

Remember, regardless of whether you qualify to defer your tax filing, you may still want to file on time, especially since usually around 70% of individual taxpayers are owed a refund and filing sooner means getting that money back sooner.

If you generally make quarterly estimated tax payments for your federal taxes, keep in mind that even though you can make the first 2020 payment by July 15, you will need to make the second payment earlier, by the regular deadline of June 15.

Because everyone is in a different situation, be sure to check in with your tax advisor as you consider what’s best for you.

Speak with your J.P. Morgan representative. In partnership with you and your tax advisors, our teams can help you identify the right solution for your long-term goals.