How the Coronavirus May Affect Your Taxes

If you are anything like those of us at Freidel & Associates, LLC, you have been bombarded with announcements from nearly every business that has your email address as to how the coronavirus pandemic could affect their services to you.  While we take the coronavirus pandemic as seriously as anyone else, the fact is that March 16, 2020, was the first filing deadline for S Corporations and Partnerships—provided that the business operates on a calendar year.  And now with March 16 behind us, the April 15, 2020 deadline is not that much further off.

While there have been plenty of proposals bandied about that the Internal Revenue Service may extend the April 15, 2020, individual filing deadline—or even for C Corporations, as well—as of March 17, 2020, we have seen no official extension of the deadline by the IRS.  And, keeping in mind that the vast majority of Americans actually overpay their tax liability and are due a refund from the federal government, delaying in filing your tax return may only result in you allowing the government to keep your tax advance for that much longer.  If you are one of those that needs to pay additional taxes in by April 15, you may end up getting an extension of the deadline to pay your tax liability—but make sure to talk to your tax professional about this to ensure that you meet whatever restrictions are ultimately put in place if the extension comes to pass as anticipated.

If the coronavirus pandemic stretches on and adversely affects the economy, it is not out of the question that the federal government will work to provide an economic stimulus.  One of the proposals to do this is suspension of the payroll tax, and the House has passed legislation that funds paid sick leave through a payroll tax credit system—but, again, at this point, there is nothing absolute.  Until there is legislation that is enacted or an executive order or official guidance from the Internal Revenue Service, please continue to consult your tax professionals.  Just because you read a headline does not mean that it is correct—and getting your taxes filed and paid timely is not something to be trifled with.

In the coming days and weeks, we will continue to monitor developments and advise clients affected by those developments.  But, until then, we will continue our work to make sure that all of our clients’ tax returns and filing obligations are thoughtfully and accurately complied with.