What’s the Deal with the COVID-19 Tax Extension?

***EDIT: On 3/20/2020, “All taxpayers and businesses will have this additional time to file and make payments without interest or penalties,” Mr. Mnuchin said on Twitter.***

tax deadline extended mnuchin

Here’s the short and sweet answer: The tax-filing deadline will remain April 15, but the IRS will waive penalties and interest on tax payments for 90 days. The IRS views filing and paying as two separate events. This extension is only an extension of payment.

Recap of Steven Mnuchin Address on Tax Relief

Today during the White House’s daily coronavirus briefing, Treasury Secretary Steven Mnuchin announced that the IRS would allow taxpayers to defer some payments.

“If you owe a payment to the IRS, you can defer up to $1 million as an individual — and the reason why we are doing $1 million is because that covers lots of pass-throughs and small businesses — and $10 million to corporations, interest-free and penalty-free for 90 days. All you have to do is file your taxes, you’ll automatically not get charged interest and penalties,”

Some states have rolled out delays due to coronavirus. For instance, California is granting a 60-day delay for affected individuals and businesses unable to file on time.

Mnuchin also encouraged Americans who can file their taxes by the April 15 deadline to do so and assured that refund issuance will not be affected for those who file. The IRS has processed more than 65 million income tax returns as of March 6. Of these, 52.7 million filers received tax refunds, averaging $3,012, according to the agency.

At this time, we now have a good idea what the tax relief package will look like but there is a lot of misinformation in the media so please be sure to check with a qualified professional before making any assumptions. The tax deadline has NOT been extended and is still April 15, 2020.

Why Should I File My Taxes Now?

The IRS is not extending the tax deadline, so if you don’t file by April 15, you may still be charged a separate penalty for not filing. The last day for an appointment to prepare your 2019 individual taxes before deadline will be on Saturday, April 11th, 2020. As a technology-enabled firm, we are prepared to serve you virtually through our secure online portal and phone appointments to still be able to complete your tax responsibilities before the April 15th deadline.

Can I File An Extension?

If you are unable to schedule an appointment or If you are still waiting for tax documents such as K1s or 1099s, we are able to file free extensions so that you do not have to worry about the April 15 deadline.

In order for us to file an extension on your behalf, please complete and send us the extension form found at this link. Extension forms must be received by 12pm on April 15th.

Ongoing Tax Updates

As the popular saying goes, “The devil is in the details”. This is especially true with taxes. We hope that more clarifications will come as to the exact details of the COVID-19 tax relief. As these updates become available, we will keep you updated. Join our mailing list or keep checking back for details.

The Molen & Associates Difference

Mike Forsyth

“Super helpful and timely. This is our first year with them and we look forward to trusting them with our taxes and business books for years to come.”

Caitlin Daulong

“Molen & Associates is amazing! They run an incredibly streamlined process, which makes filing taxes a breeze. So impressed with their attention to detail, organization, and swift execution every year. Cannot recommend them enough!”

Sy Sahrai

“I’ve been with Mr. Molen’s company for few years and I felt treated like family respect and dignity. They are caring, professional and honest, which hard to find these days. Love working with them.”

Change Independent Contractors into Employees Trouble-Free

Independent contractors are a vital part of the American workforce. They work for themselves, usually providing services to other businesses. While this setup offers many advantages to both the contractor and the hiring business, it can also create tax problems.   You...

Is retirement the same thing it used to be?

The modern concept of retirement has only been around for about 100 years. Though relatively new, what retirement looks like and how people are planning for retirement has changed significantly in the last few decades. With roughly 9000 Americans reaching the average...

Cash in: Beat The Taxman With 11 Tax-free Income Breaks

No one likes paying taxes, but what if there were a way to reduce the taxes you owe each year? Luckily, several tax-free income breaks can help lower your tax bill. Here are 11 of the best ways to beat the taxman. Break 1: accumulation and withdrawals of tax-free...

I owe to the IRS, what do I do now?

We know owing taxes can be a headache, especially if you don’t have a CPA or tax advisor to walk you through the process. If you fail to pay your taxes, in most cases you will only face interest or penalties, rather than going to prison for tax evasion. Even if you do...

Credit, Debt and Personal Finances 101

In an era of credit cards, services that allow you to “buy now, pay later”, and access to loans at your fingertips, it is easy to indulge in lifestyle you can’t necessarily afford on your budget. Before your fall too deep down the rabbit hole – or if you may already...

Buying an Electric Vehicle? Know These Tax Law Changes

 Are you thinking of buying an electric vehicle or a plug-in hybrid and taking advantage of the Electric Vehicle Tax Law Changes? If so, you have much to consider—thanks to the newlyenacted Inflation Reduction Act and Electric Vehicle Tax Law Changes. Let’s get...

Dealing With The New 62.5 Cents Mileage Rate

Due to rising gas prices, the Internal Revenue Service (IRS) announced an increase in the standard mileage rate for business travel. As a result, small businesses that make use of the standard mile rates can deduct 62.5 cents per mile for business mileage.  This is...

FAQ on Student Loan Cancellation

What is the Student Loan Cancellation? Last month, President Biden laid out a plan to cancel up to $20,000 in federal student loan debt per borrower. Beneath this seemingly simple plan comes quite a few questions about how, exactly, it will work. Naturally, borrowers...

Need to Change from 1099 to W2? Read More About This Safe Harbor Relief

IRS declared independent contractors as employees: Can Section 530 help?  Are you going through an IRS audit? Though we know that is bad but what happens if the IRS declares that many of your 1099 independent contractors are W-2 employees, now what?    Safe-harbor...

The IRS is Watching Cryptocurrency Closely

The IRS wants to know of any bitcoins or other cryptocurrencies you have. It will appear at the top of the first page of your Form 1040, below your address and name. The IRS wants to monitor crypto purchases and sales starting this year.   Anyone filing a tax return...

Request an Appointment Today

2 + 3 =

Call us at

Pin It on Pinterest

Share This