IRS Provides Additional Guidance Regarding Extended Tax Deadlines
The IRS issued Notice 2021-21 and an accompanying news release on March 29, 2021. The notice does extend a few additional tax deadlines from April 15 to May 17, but this deadline extension remains very limited in scope. The extensions are designed to provide additional relief for individual taxpayers in light of the ongoing COVID-19 pandemic.
The only income tax returns extended to May 17 remain 2020 federal income tax returns for individual filers (Form 1040 and all schedules and forms attached to Form 1040) and the related tax payments due. However, the notice reiterates that this extension does not apply to an individual filer’s 2021 first quarter estimated tax payment, which remains due by April 15. The timing of state estimated tax payments must also be considered as many states have followed the federal treatment in leaving the first quarter 2021 estimates due by April 15.
All other tax returns and payments otherwise due by April 15 remain due by April 15, including, but not limited to, C corporations (Form 1120), trust and estates (Form 1041), gift tax returns (Form 709), and certain other filings.
The notice does provide additional extensions to May 17 for:
- 2020 contributions to individual retirement arrangements (IRAs and Roth IRAs), health savings accounts (HSAs), Archer Medical Savings Accounts (Archer MSAs), and Coverdell Education Savings Accounts (Coverdell ESAs)
- Reporting and payment of the 10% additional tax on amounts included in gross income from 2020 distributions from IRAs or workplace-based retirement plans such as 401(k)s
- The time to file a refund claim via the Form 1040 series or a Form 1040-X when the period of limitations to file such claim expires on or after April 15, 2021, and before May 17, 2021
Additionally, the deadline for filing the Form 5498 series is extended to June 30, 2021.
Due to the limited scope and uncertainty with many aspects of this deadline extension, our recommendation is to continue working toward the tax deadline as if it was still April 15. Please reach out to your KSM advisor for questions, or complete this form.
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