UPDATED: What Tax Filings and Payment Deadlines Have Been Extended by the IRS and the Virginia Department of Taxation?

The Internal Revenue Service (IRS) and the Virginia Department of Taxation (Department) have each provided guidance regarding the extensions for the filing of tax returns and the payment of taxes. This outline of IRS and Department guidance, as of April 14, 2020, is intended to provide a brief summary of the extended deadlines for federal tax returns and Virginia tax returns, including payment and filing extensions.

UPDATE: On April 22, 2020, the Virginia General Assembly enacted budget language to waive the accrual of interest for certain Virginia income and sales tax payments. The Department issued Virginia Tax Bulletin 20-5 to provide related guidance on April 27, 2020.

Federal

1. IRS Notice 2020-18 (Issued March 21, 2020): For any Affected Taxpayer, the federal income tax payment or federal income tax return due on April 15, 2020 is automatically postponed to July 15, 2020.
   • Any person with a federal income tax payment or federal income tax return due on April 15, 2020 is an Affected Taxpayer and qualifies for relief granted by the notice.
   • IRS Notice 2020-18 supersedes IRS Notice 2020-17 (Issued March 18, 2020).
   • Person means an individual, a trust, estate, partnership, association, company or corporation, as defined in Section 7701(a)(1) of the IRC.
   • No extension form (Form 4686 or 7004) is required to be filed.
   • There is no limitation on the amount of the payment that may be postponed.
   • Solely for federal income tax payments (including payments on self-employment income) and federal estimated income tax payments.
   • The April 15, 2020 tax filing deadline is for individuals, C Corporations, estates, and trusts. There was no mention regarding tax exempt entities. There was no mention of retroactive effects on the March 16, 2020 filing deadline for partnerships and S Corporations.
2. IRS Notice 2020-20 (Issued March 27, 2020): Any person (as defined in section 7701(a)(1) of the IRC) with a Federal gift tax or generation-skipping transfer tax payment due or the requirement to file Form 709, United States Gift and Generation-Skipping Transfer Tax Return on April 15, 2020 may postpone filing and payment until July 15, 2020.
   • Amplifies IRS Notice 2020-18.
   • No filing is required for the extension.
   • A taxpayer may choose to file Form 8892 by July 15, 2020, to obtain an extension to file Form 709 by October 15, 2020 (any federal gift and generation-skipping transfer tax payments postponed by this notice will still be due on July 15, 2020).
3. IRS Notice 2020-23 (Issued April 9, 2020): Any person (as defined in section 7701(a)(1) of the IRC) with a Specified Payment or Specified Form which is due between April 1, 2020 and July 15, 2020 is postponed to July 15, 2020.
   • A Specified Payment is a Federal tax payment obligation in the Notice List provided below.
   • Specified Form is a Federal tax return or other form filing obligation specified in the Notice List provided below.
   • Notice List:
     • Individual income tax payments and return filings on:
       • Form 1040, U.S. Individual Income Tax Return,
       • Form 1040-SR, U.S. Tax Return for Seniors,
       • Form 1040-NR, U.S. Nonresident Alien Income Tax Return,
       • Form 1040-NR-EZ, U.S. Income Tax Return for Certain Nonresident Aliens With No Dependents,
       • Form 1040-PR, Self-Employment Tax Return – Puerto Rico, and
       • Form 1040-SS, U.S. Self-Employment Tax Return;
     • Calendar year or fiscal year corporate income tax payments and return filings on:
       • Form 1120, U.S. Corporation Income Tax Return,
       • Form 1120-C, U.S. Income Tax Return for Cooperative Associations,
       • Form 1120-F, U.S. Income Tax Return of a Foreign Corporation,
       • Form 1120-FSC, U.S. Income Tax Return of a Foreign Sales Corporation,
       • Form 1120-H, U.S. Income Tax Return for Homeowners Associations,
       • Form 1120-L, U.S. Life Insurance Company Income Tax Return,
       • Form 1120-ND, Return for Nuclear Decommissioning Funds and Certain Related Persons,
       • Form 1120-PC, U.S. Property and Casualty Insurance Company Income Tax Return,
       • Form 1120-POL, U.S. Income Tax Return for Certain Political Organizations,
       • Form 1120-REIT, U.S. Income Tax Return for Real Estate Investment Trusts,
       • Form 1120-RIC, U.S. Income Tax Return for Regulated Investment Companies,
       • Form 1120-S, U.S. Income Tax Return for an S Corporation, and
       • Form 1120-SF, U.S. Income Tax Return for Settlement Funds (Under Section 468B);
     • Calendar year or fiscal year partnership return filings on:
       • Form 1065, U.S. Return of Partnership Income, and
       • Form 1066, U.S. Real Estate Mortgage Investment Conduit (REMIC) Income Tax Return;
     • Estate and trust income tax payments and return filings on:
       • Form 1041, U.S. Income Tax Return for Estates and Trusts,
       • Form 1041-N, U.S. Income Tax Return for Electing Alaska Native Settlement Trusts, and
       • Form 1041-QFT, U.S. Income Tax Return for Qualified Funeral Trusts;
     • Estate and generation-skipping transfer tax payments and return filings on:
       • Form 706, United States Estate (and Generation-Skipping Transfer) Tax Return,
       • Form 706-NA, United States Estate (and Generation-Skipping Transfer) Tax Return,
       • Form 706-A, United States Additional Estate Tax Return,
       • Form 706-QDT, U.S. Estate Tax Return for Qualified Domestic Trusts,
       • Form 706-GS(T), Generation-Skipping Transfer Tax Return for Terminations,
       • Form 706-GS(D), Generation-Skipping Transfer Tax Return for Distributions, and
       • Form 706-GS(D-1), Notification of Distribution from a Generation Skipping Trust (including the due date for providing such form to a beneficiary);
     • Form 706, United States Estate (and Generation-Skipping Transfer) Tax Return, filed pursuant to Revenue Procedure 2017-34;
     • Form 8971, Information Regarding Beneficiaries Acquiring Property from a Decedent and any supplemental Form 8971;
     • Gift and generation-skipping transfer tax payments and return filings on Form 709, United States Gift (and Generation-Skipping Transfer) Tax Return that are due on the date an estate is required to file Form 706 or Form 706-NA;
     • Estate tax payments of principal or interest due as a result of an election made under Sections 6166, 6161, or 6163 of the IRC and annual recertification requirements under Section 6166 of the IRC;
     • Exempt organization business income tax and other payments and return filings on Form 990-T, Exempt Organization Business Income Tax Return;
     • Excise tax payments on investment income and return filings on Form 990-PF,
     • Return of Private Foundation or Section 4947(a)(1) Trust Treated as Private Foundation, and excise tax payments and return filings on Form 4720, Return of Certain Excise Taxes under Chapters 41 and 42 of the IRC;
     • Quarterly estimated income tax payments calculated on or submitted with:
       • Form 990-W, Estimated Tax on Unrelated Business Taxable Income for Tax-Exempt Organizations,
       • Form 1040-ES, Estimated Tax for Individuals,
       • Form 1040-ES (NR), U.S. Estimated Tax for Nonresident Alien Individuals,
       • Form 1040-ES (PR), Estimated Federal Tax on Self Employment Income and on Household Employees (Residents of Puerto Rico),
       • Form 1041-ES, Estimated Income Tax for Estates and Trusts, and
       • Form 1120-W, Estimated Tax for Corporations.
   • The extension relief includes all schedules, returns, and other forms that are filed as attachments to Specified Forms or are required to be filed by the due date of Specified Forms.
   • No filing is required for the extension.
   • Taxpayers can file the applicable extension to receive the usual extension for filing, which is generally not an extension for payment.
   • The IRS Notice provides for postponement of the following deadlines if due to be performed on or after April 1, 2020, and before July 15, 2020 to July 15, 2020:
     • Filing a petition with the Tax Court, or for review of a decision rendered by the Tax Court;
     • Filing a claim for credit or refund of any tax;
     • Bringing suit upon a claim for credit or refund of any tax;
     • Any time-sensitive action listed in Revenue Procedure 2018-58; or
     • The election to invest gains into a qualified opportunity fund subject to the 180-day investment limitation measured from the sale or exchange generating the gains pursuant to Section 1400Z-2(a)(1)(A) of the IRC.
   • The IRS Notice grants a 30-day postponement whose last date for performance of the action is on or after April 6,2020, and before July 15, 2020 for the following taxpayers:
     • Persons who are currently under examination (including an investigation to determine liability for an assessable penalty);
     • Persons whose cases are with the Independent Office of Appeals; and
     • Persons who, during the period beginning on or after April 6, 2020 and ending before July 15, 2020, file written documents described in section 6501(c)(7) of the IRC (amended returns) or submit payments with respect to a tax for which the time for assessment would otherwise expire during this period.
   • Amplifies IRS Notice 2020-18 and IRS Notice 2020-20.
4. IRS Notice 2020-24 (Issued April 9, 2020): Provides a 6-month extension for taxpayers to file Form 1045, Application for Tentative Refund or Form 1139, Corporation Application for Tentative Refund, as applicable, that have a net operating loss (“NOL”) that arose in a taxable year that began during calendar year 2018 and that ended on or before June 30, 2019.
   • The ability to carryback NOLs was granted by Section 2303 of the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), Public Law 116-136, 134 Stat. 281 (March 27, 2020).
   • To receive the extension of time for requesting a tentative refund based on a NOL carryback, the taxpayer must:
     • File the applicable form no later than 18 months after the close of the taxable year in which the NOL arose (that is, no later than June 30, 2020, for a taxable year ending December 31, 2018); and
     • Include on the top of the applicable form “Notice 2020-26, Extension of Time to File Application for Tentative Carryback Adjustment.”

For the latest information regarding federal tax filing and deadlines, refer to guidance and resources from the IRS and the Coronavirus Tax Relief website.

Virginia

1. Virginia Tax Bulletin 20-3 (Issued March 19, 2020):
   • Businesses can request an extension of the due date for filing and payment of their February 2020 sales tax return due March 20, 2020, for 30 days.
   • When granted, businesses will be able to file and pay no later than April 20, 2020 with a waiver of any penalties. Interest will accrue even if the extension is granted.
2. Virginia Tax Bulletin 20-4 (Issued March 20, 2020):
   • The due date for certain Virginia income tax payments has been moved to the deadline of June 1, 2020.
   • Applies to:
     • Individual income taxes,
     • Corporate income taxes,
     • Fiduciary income taxes, and
     • Any estimated income tax payments that are required to be paid to the Department during the April 1, 2020 to June 1, 2020 period.
   • Any income tax payments due during the period from April 1, 2020 to June 1, 2020 can now be submitted to the Department at any time on or before June 1, 2020 without penalty.
   • The penalty waiver will not apply if payment is not made by June 1, 2020 and the penalty and interest will accrue from the original due date.
   • Interest continues to accrue from the original due date of the payment regardless of whether full payment is made by June 1, 2020.
   • This is NOT AN EXTENSION FOR FILING.
     • Virginia offers automatic filing extensions to all taxpayers for up to six months (or seven months in the case of C Corporations).
     • No application is required to file an extension.
     • Any extension payments must be made by June 1, 2020 to avoid late payment or extension penalties.
3. UPDATE: Virginia Tax Bulletin 20-5 (Issued April 27, 2020):
   • Virginia waived the accrual of interest on any payment originally due between April 1, 2020 and June 1, 2020 for a taxable year 2019 individual, corporate, or fiduciary Virginia income tax return, as well as any such payment required to be made with respect to an election to file on extension, if the full payment is made on or before June 1, 2020.
     • The interest waiver applies to any individual, corporate, or fiduciary estimated Virginia income tax payments that are required to be paid during the period from April 1, 2020 to June 1, 2020.
     • The interest waiver also applies to payments associated with composite returns.
   • Pursuant to Virginia Tax Bulletins 20-5 and 20-4, the specified taxpayers may delay Virginia income tax payments until June 1, 2020 without interest or penalties and the relief is automatic with no paperwork or application required.
   • If a taxpayer plans to file on extension, the taxpayer must pay at least 90% of his or her total income tax liability by June 1, 2020 and then pay the remaining taxes due on or before the date the tax return is filed on extension. Otherwise, interest and penalties may apply.  Interest will accrue on any outstanding income tax liability from the original due date of the tax return.
   • The interest relief does not apply to Virginia nonresident withholding tax.
   • The interest waiver and the payment extension announced in Virginia Tax Bulletin 20-4 do not apply to employer withholding of Virginia income taxes.
   • Virginia granted a waiver of the interest that would have otherwise accrued for the late payment due on the extended February 2020 sales tax return and payment due in March pursuant to Virginia Tax Bulletin 20-3.
     • This waiver of interest on sales tax return payments only applies to such sales tax return payments submitted to the Department by April 20, 2020.

For further guidance on other state filing and payment deadlines, the American Institute of CPAs maintains a regularly updated chart summarizing each state’s rules with links to primary government sources. The chart is available here.

Disclaimer: The information contained herein is not intended to be “written advice concerning one or more Federal tax matters” subject to the requirements of section 10.37(a)(2) of Treasury Department Circular 230. The information contained herein is of a general nature and based on authorities that are subject to change. Applicability of the information to specific situations should be determined through consultation with your tax, legal, and financial adviser. This summary is not the provision of accounting, business, financial, investment, legal, tax, or other professional advice or services. Sands Anderson PC shall not be responsible for any loss incurred by any person who relies on this summary.