IRS Provides 90-Day Federal Income Tax Payment Relief Due to COVID-19

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On March 18, 2020, the IRS issued Notice 2020-17 which extends the due date for payment of certain federal income taxes otherwise due on April 15, 2020, to July 15, 2020. 

Notice 2020-17 provides that each consolidated group of corporations (as defined in §1.1502-1) or for each C corporation that does not join in filing a consolidated return may defer payment of up to $10,000,000 of  federal income taxes otherwise due on April 15, 2020 to July 15, 2020.  All other taxpayers will be permitted to defer payment of up to $1,000,000 regardless of filing status. For example, the $1,000,000 limitation is the same for a single individual and for married individuals filing a joint return.

The payment relief provided by Notice 2020-17 is available solely with respect to Federal income tax payments (including payments of tax on self-employment income) due on April 15, 2020, in respect of the taxpayer’s 2019 Federal income tax liability, and Federal estimated income tax payments (including payments of tax on self-employment income) due on April 15, 2020, for the taxpayer’s 2020 tax year.

No extension is provided in Notice 2020-17 for the payment or deposit of any other type of Federal tax (such as payroll taxes), or for the filing of any tax return or information return.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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