Tax Payment & Quarterly Estimated Payment Deferral

More About | Tax | COVID-19

Today the IRS issued Notice 2020-17 officially providing for the payment deferral recently announced by Secretary Mnuchin on March 17th.

Under the Notice a deferral until July 15, 2020 is provided for Federal income taxes which would otherwise be due on April 15, 2020. This includes first quarter estimated payments for the 2020 tax year as well as taxes due for the 2019 tax year. C-corporations with fiscal years which would result in taxes being due during another month are not encompassed by the Notice.

The Notice places an aggregate cap on the amount of tax that may be deferred until the July 15th date without application of penalties and interest. In the case of individuals the cap is $1 million regardless of filing status. In the case of C-corporations the cap is $10 million per consolidated group or $10 million for each corporation that does not join in the filing of a consolidated return.

Interest, penalties and applicable additions to tax on the amounts deferred under the Notice will begin on July 16th if such amounts remain unpaid. Additionally, interest and penalties will accrue from the original April 15th due date for any unpaid tax due in excess of the caps.

The Notice also specifies that no extension of time is being granted for the payment or deposit of any other type of tax or for the filing of any tax return or information return.