The extension of Tax Day has brought some relief to taxpayers who might wish to file and, perhaps, pay later in the summer, but for tax preparers, they goal is to work as if nothing has changed.
On Saturday, March 21, the Treasury Department and Internal Revenue Service (IRS) announced that the federal income tax filing due date is automatically extended from April 15 to July 15.Taxpayers can also defer federal income tax payments due on April 15 to July 15 without penalties and interest, regardless of the amount owed. This deferment applies to all taxpayers, including individuals, trusts and estates, corporations and other non-corporate tax filers as well as those who pay self-employment tax. There are also no additional forms to file or calls to make to take advantage of the extension.
For Richard Stern, a CPA who works in the Back Bay and lives in the South End, the extension provides some relief, but he’s not using it as a crutch.
He said many of his clients are young people who got inadvertently hit by the new tax code last year with high tax bills. They are anxious to know if that happened again, and would like to take care of it, and other people who receive refunds simply want more cash in their pocket given the uncertainly of the financial markets.
“The answer as to whether this helps me is ‘Yes, but,’” he said last Friday. “It’s something that I know is there if I need it. I’m just trying to not acknowledge it so I stay motivated. For my clients, many of them want their drafts at the same time and I don’t want to ruin their expectations. I have to fight hard to get there and ignore the extension. The goal is to get everything done, but I do know I have the extra time if I really need it.”
That falls in line with the guidance from the IRS, which urges taxpayers who are due a refund to file as soon as possible. Most tax refunds are still being issued within 21 days.
“Even with the filing deadline extended, we urge taxpayers who are owed refunds to file as soon as possible and file electronically,” said IRS Commissioner Chuck Rettig. “Filing electronically with direct deposit is the quickest way to get refunds. Although we are curtailing some operations during this period, the IRS is continuing with mission-critical operations to support the nation, and that includes accepting tax returns and sending refunds. As a federal agency vital to the overall operations of our country, we ask for your personal support, your understanding – and your patience. I’m incredibly proud of our employees as we navigate through numerous different challenges in this very rapidly changing environment.”
More than anything for Stern is the numbers of Board meetings and business meetings he’s been asked to attend for tax advice related to the financial meltdown. Many are trying to figure out how they will stay solvent or stay in business, and there are many unknowns, he said.
“There’s a general business panic out there and there have been a lot of meetings,” he said. “I’ve been pulled into a lot of meetings…and they’re trying to figure out what can they do and what should they do.”
The Tax Day announcement comes following President Donald Trump’s emergency declaration this month pursuant to the Stafford Act. The Stafford Act is a federal law designed to bring an orderly and systematic means of federal natural disaster and emergency assistance for state and local governments in carrying out their responsibilities to aid citizens. It was enacted in 1988.