As the COVID-19 outbreak rages in the United States, businesses and schools have closed and events have been canceled, leaving employees and business owners without work and at a loss for income. Even the U.S. Navy is struggling. No aspect of life seems to be untouched; filing and paying taxes is no exception.
When are taxes due?
2019 federal income tax returns are now due on July 15, 2020. Treasury Secretary Steven Mnuchin announced in March that the IRS tax deadline would be pushed back from April 15, 2020. The IRS confirmed the new deadline the following day for 2019 tax returns and payments, with no fees or interest, but encouraged taxpayers to file earlier if possible.
Am I eligible for the new tax deadline?
The new deadline applies to all taxpayers, including individuals, freelancers and others who pay self-employment tax, as well as “trusts and estates, corporations and other non-corporate tax filers,” according to the IRS.
Do I need to file for a tax extension to be eligible for the new deadline?
No. Taxpayers are automatically eligible for the new deadline.
Does the new deadline apply to all taxes?
Nearly. The original extension applied to federal income taxes due on April 15, 2020, but on April 9, 2020 the IRS expanded the tax extension to “additional returns, tax payments and other actions” for “individuals, trusts, estates, corporations and other non-corporate tax filers.” These new extensions “generally” apply to all taxpayers who have a filing or payment deadline between April 1, 2020, and July 15, 2020. That includes payment of quarterly estimated taxes and filing for 2016 unclaimed refunds.
While many states have followed the IRS’ lead and delayed their state tax deadlines until July 15, as of April 2020, not every state has. Here is an updated list of how each state has approached its tax deadlines in response to the coronavirus.
Will my tax refund be delayed?
No. Most tax refunds are still being paid within 21 days of filing. The IRS encourages taxpayers to file electronically with direct deposit as it’s the quickest way to receive your tax refund. While the IRS continues to accept paper forms, it notes that during this period, delays may happen for paper filers. Here’s how to track your tax refund.
If I already filed and set up automatic payments, will that be delayed until July 15?
No. If you can’t pay your taxes at the scheduled date and you used IRS Direct Pay or its Electronic Federal Tax Payment System, you can change the date there, so long as you do so two days before the scheduled date. If you authorized an electronic funds request, you can contact the U.S. Treasury Financial Agent two days before the scheduled date at 888-353-4537 to change the date.
Do I have to pay to file my taxes with the new deadline?
No. If you made less than $69,000 in 2019, there is almost certainly a free and easy resource for you to use to file your taxes. You might be able to file for free even if you made more than that. Companies like Intuit (TurboTax) and H&R Block publish a lot of “tax guide” content on the internet and have continued to do so around the coronavirus tax extension. Most of these posts are optimized to make the most of search engine trends, and they are indistinguishable from paid search ads. But beware: Nearly all of the tax guides reviewed by ProPublica link to these companies’ paid products, not their Free File products, so even if you are eligible to file for free, you may be required to pay to file.
Susan Waldron, director of communications for H&R Block, said: “During these uncertain times caused by the pandemic, our focus at H&R Block is on the well-being of our clients, communities and associates. We understand refunds and the stimulus payments are vitally important for millions of households. We are ready to help, and are currently modifying our do-it-yourself free online product, as well as working with the IRS and industry to modify the online product available through the IRS Free File program, so that people who are typically not required to file taxes can submit a return for free and provide bank account information. While we continue to support the IRS Free File program, it is the responsibility of the IRS to promote it.”
Meanwhile, Rick Heineman, a spokesperson for Intuit, provided the following: “Any assertion that Intuit does not support IRS Free File and free tax preparation is wholly false and ignores facts. In addition to fully complying with the spirit and terms of the MOU, TurboTax has donated millions of dollars to promote Free File and other free tax services and has published information about Free File to educate taxpayers. Rather than try to hide Free File, last year TurboTax did more than anyone else to promote the program.”
In February of 2020, an audit from the Treasury Inspector General for Tax Administration found that “sufficient actions have not been taken to educate taxpayers that the only way to participate in the Free File Program is through the IRS website.” If this is true, only linking to paid products would not be in violation of the Free File agreement. However, the audit also makes clear that “this provision is not in the Memorandum of Understanding (MOU) between the IRS and Free File Inc., and most taxpayers are unaware of this requirement.”
So, for the record:
- Here is how to file for free via Free File on TurboTax.
- Here is how to file for free via Free File on H&R Block.
- Here are other free filing options.
ProPublica has reported extensively on the ways these companies trick citizens and U.S. troops into thinking they need to pay to file their taxes, including how the companies deliberately hid their Free File option from search results, then bought up tons of Google search ads for their paid product when they were eventually ordered to stop by the IRS.