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Federal Tax Updates (Last Update: 3/27/20)

In response to coronavirus, the Treasury, IRS and federal government have announced several changes to the tax filing season and coronavirus relief and stimulus packages. Here is everything you need to know.

The federal tax filing deadline has been extended to July 15, 2020.  Taxpayers getting a refund are encouraged to file their taxes now to get their money. 

Last tax season, close to 72% of taxpayers received a tax refund close to $3,000, which for many taxpayers is their largest paycheck of the year. During times like this, that is much needed money for many households. The IRS expects to continue to process refunds as normal. The IRS typically issues nine out of 10 tax refunds within 21 days or less from acceptance with e-file and direct deposit – the fastest way to get your refund.

The Coronavirus Stimulus Package

On Friday, March 27, 2020, the President signed the Coronavirus Aid, Relief and Economic Security Act (CARES) — a $2 trillion stimulus package that will provide financial relief to individuals, families and businesses — into law.  The 2020 coronavirus stimulus package will deliver relief through a range of measures, including an advanced tax rebate for taxpayers.

Eligible taxpayers will receive stimulus checks of up to $1,200 for individuals, $2,400 for joint taxpayers and an additional $500 for each qualifying child.

COVID-19 stimulus payments will be based on information from your most recent tax filings, either 2019 or 2018, if you have not yet filed this season. However, the amount paid to you now will be reconciled on next year’s tax return based on your current 2020 situation.

The CARES Act also allows the government to leverage the direct deposit information in your tax year 2019 or 2018 tax return to deposit these stimulus funds electronically into your account. So what does all this mean?

The first step you should take right now is to file your 2019 tax return, if you have not already. And, if you are getting a tax refund, choose to receive that refund through direct deposit. This will ensure that the IRS has the most current tax filing and direct deposit information for you, which they will use to determine individual stimulus amounts.

Get the latest information and updates on the 2020 stimulus package and what it means for you — including information on how much stimulus money you are eligible to receive and how long it will take to receive your stimulus check — here.

Relief for Individuals and Businesses with Tax Payments

The extension of the federal tax filing deadline also applies to tax payments. Taxpayers that owe money can defer federal tax payments, interest free and penalty free until July 15. This deferment applies to all taxpayers, including individuals, trusts and estates, corporations and other non-corporate tax filers as well as those who pay self-employment tax. Taxpayers can defer tax year 2019 federal tax payments regardless of the amount owed. This deferment also applies to tax year 2020 first and second quarter estimated tax payments previously due on April 15 and June 15.

Deferment of federal tax payments means that if you owe money on your federal taxes, you will get more time to pay what you owe.

Federal Tax Update regarding the Families First Coronavirus Response Act 

On Wednesday, March 18, President Trump signed into law legislation to provide additional relief for taxpayers impacted by Coronavirus (COVID-19).

The COVID-19 legislation, called the Families First Coronavirus Response Act or H.R. 6201, includes relief for individuals, self-employed and businesses. Get the latest information on the Families First Coronavirus Response Act and what it means to you here.

We’ve Got You Covered

Taxpayers can be confident that TurboTax is ready to help them file now up until the extended July 15 deadline. If you have any questions along the way, our team of credentialed TurboTax Live CPAs and EAs are available on demand to help you out.

Continue to check back here for the most up to date tax information and changes in response to Coronavirus.

State Tax Updates (Last Update: 4/2/20)

California

For a full list of dates for individuals and businesses go to: FTB

Source: https://blog.turbotax.intuit.com/tax-news/is-the-tax-deadline-delayed-what-to-know-about-coronavirus-covid-19-and-your-taxes-46320/