Today’s the Day!

In March, the Internal Revenue Service implemented an “intermission” on tax collection in response to the coronavirus pandemic giving taxpayers a reprieve on filing (or paying) their taxes up to July 15, 2020.  In addition to debt relief via the stimulus plan, the IRS also paused on debt collection from delinquent taxpayers postponing payments on installment agreements. The “People First” initiative was a lifeline for many people during the unprecedented and challenging times resulting from “Safer at Home” orders, temporary business closures, and unexpected job loss.  

As they say, “time flies when you are having fun” and today is the day to file your tax return if you have not already done so.  Even though the coronavirus initiatives are ending, there are still a few things you can do if you are not ready to file or cannot pay your taxes right now. 

If you need more time to file a federal tax return, filling out the IRS FORM 4868 by July 15th will give an automatic extension October 15th, 2020 to file your return.  As already mentioned in last month’s post https://randolphacctg.com/an-extension-of-time/, the Form 4868 is an extension of time to file a return, not an extension of time to pay your taxes if you owe.  Filing an extension request, along with paying an estimate on the taxes you owe by the deadline may help you avoid potential “failure to pay” penalties.  Regardless of income, all tax filers are eligible to use the IRS’ Free File https://www.irs.gov/filing/free-file-do-your-federal-taxes-for-free to submit the extension form and estimated tax payment.

 Filing your tax return by the deadline, even if you cannot pay right now, will eliminate any “failure to file” penalties that might be incurred.  The “failure-to-file” penalty is generally more than the “failure-to-pay” penalty and filing a timely tax return is crucial.   If your tax return is ready, but the total tax liability is more than a financial burden right now, file anyway, pay as much as you can, and make an installment agreement to pay payments on your tax bill.  It’s important to note that installment agreements are available for qualified taxpayers and a great resource if you can pay all taxes owed within the extended timeframe.  https://www.irs.gov/payments/online-payment-agreement-application

With the pandemic, financial hardship, and unemployment continuing to be at the forefront for many Americans, the IRS is willing to work with most taxpayers.  More information on the “People First” initiative can be found here: https://www.irs.gov/newsroom/people-first-initiative-providing-relief-to-taxpayers

As always, Randolph Business Resources is here to lend a helping a hand. If we can help with getting your personal or professional accounting and bookkeeping “T’s” crossed and “I’s” dotted during this unprecedented time, we will find a way together. 

By Susan Amsler

July 15, 2020

Randolph Business Resources, LLC.
Our experienced staff are ready to lend a hand to you and your business.
Visit us @ www.randolphacctg.com
Call us at: (615)202-5829 if you need immediate assistance