Federal & Wisconsin Tax Filing Relief
*This article has been amended to reflect the Wisconsin tax filing changes.
In a tweet on the morning of March 20, Secretary of the Treasury, Steven Mnuchin said, “At [President Trump’s] direction, we are moving Tax Day from April 15 to July 15. All taxpayers and businesses will have this additional time to file and make payments without interest or penalties.” In a follow-up tweet, Mnuchin wrote, “I encourage all taxpayers who may have tax refunds to file now to get your money.”
Later that day, the IRS issued Notice 2020-18. This notice supersedes and replaces Notice 2020-17. The relief provided in the original notice is restated and expanded.
Key federal income tax changes:
- For any taxpayer with a federal income tax return filing or payment due April 15, that deadline is automatically extended to July 15.
- The prior postponement of tax payments has now been expanded to include the deadlines for tax filings due April 15.
- Taxpayers do not need to file extensions on Forms 4868 or 7004.
- There is now no limit on the amount of payment that may be postponed. (The previous limitations of $1 million for individuals/noncorporate filers, and $10 million for corporate filers, have been removed.)
This relief continues to apply only with respect to federal income tax payments and federal income tax returns due on April 15, related to the 2019 tax year and federal estimated income tax payments for the 2020 tax year due April 15. No extension is provided for the payment or deposit of any other type of federal tax or required filing.
On March 21, Wisconsin Governor Evers and Secretary Barca, announced that due to the presidentially declared disaster, Wisconsin tax filers will be extended time and waived interest and penalties.
Key Wisconsin income tax changes:
- For any taxpayer with a Wisconsin income tax return filing or payment due April 15, that deadline is automatically extended to July 15.
- Taxpayers do not need to file an extension.
- No interest or penalties will be applied from April 15 to July 15.
- There is no limit on the amount of payment that may be postponed.
Each state continues to evaluate options and available actions at the state level. For a summary of each state’s filing relief and response, please refer to this chart created by the American Institute of Certified Public Accountants (AICPA).
Additional Wisconsin tax return updates made on March 25:
- See Wisconsin Department of Revenue proposed guidance document https://www.revenue.wi.gov/Pages/TaxPro/2020/TaxDeadlinesExtendedCOVID.pdf
- Note question #8- Contributions to 529 plans are not extended and need to be made by April 15th, for 2019.
- There is a one month extension granted for the filing and payment of withholding deposits (question #11) sales and use tax returns (question #12) and excise tax (question #13).
- Related to the payment of withholding, sales and excise tax, note that interest will still be charged during the 1-month extension at 1%. So while there is an extension available it does come at a cost.
In this ever-changing situation and environment of instantaneous information, we want to assure everyone that we are staying current and are aware of developments as they happen. Rather than adding to the barrage of information overload that we are all experiencing, we are choosing to be strategic and deliberate in our communications in order to provide context and attempt to keep them relevant. We also operate in an arena of facts and authority, bits of information, or items from a tweet without the related details; and clarifications only add to the confusion and create more questions. Rather than being fast or first, we’d rather be accurate and meaningful.
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