Americans now have three more months to pay -- and file -- their taxes, as of Friday’s announcement by the U.S. Treasury Secretary Steve Mnuchin.
Tax filers now have until July 15 to pay their 2019 tax bills. Individuals can defer up to $1 million of tax liability while corporations get an extension on up to $10 million, Mnuchin said at a news conference earlier this week.
“All you have to do is file your taxes,” he said. “You’ll automatically not get charged interest and penalties.”
However, Mnuchin suggested that Americans should stick to the original deadline, if possible.
“We encourage those Americans who can file their taxes to continue to file their taxes on April 15, because for many Americans, you will get tax refunds,” Mnuchin said.
The payment and filing extension, which affects millions of taxpayers, is part of the Trump administration’s effort to curb the brutal economic effects of the coronavirus pandemic.
If you defer payments on your income taxes for up to 90 days after the April 15 filing deadline, any interest or penalties will be waived.
Last year, of the tax returns processed, more than 73% of Americans received refunds, with the average amount totaling $2,725.
Alan Gubernick, a partner with St. Clair CPA Solutions accounting firm in Conshohocken, is advising clients to try to file as soon as possible -- especially if they’re owed a refund.
What about estimated 2020 payments for individuals and businesses? Also delayed until July 15.
For those receiving or applying for unemployment, “benefits are not taxable for Pennsylvania and New Jersey, but Delaware does tax unemployment,” he said.
Again, if you’re due a refund, “there’s no reason to wait. File your taxes now,” said Eric Bronnenkant, the head of tax at online financial advisor Betterment.
Drucker & Scaccetti accounting firm set up a COVID-19 information page, with a link at this online address: https://www.taxwarriors.com/en-us/covid-19-tax-resource-center-.
The American Institute of CPAs’ president and CEO, Barry Melancon earlier this week criticized the lack of a delay in filing.
“Unfortunately, this important payment relief does not apply to the filing of tax returns. The concern and confusion related to coronavirus is causing cities across the country to shut businesses down, and Treasury’s recent decisions do not reflect the real-world difficulties tax practitioners and their clients are experiencing.”
It’s impossible for every taxpayer and their tax adviser to prepare returns in this environment, he added.
"Even the simple process of filing an extension form requires calculations based on data and information from the taxpayer. Given the current environment, this extension process is impossible for many taxpayers. Treasury must act immediately by extending the April 15th filing deadline and providing more clarity on the details of recent relief actions.”
In response to the COVID-19 pandemic, the Fox School of Business has moved its Volunteer Income Tax Assistance (VITA) program online.
The program will now be facilitated through the use of Zoom Video Communications technology and TUsafesend, a resource that makes it easy to securely send and receive files from within and outside the university.