Treasury Secretary Steven Mnuchin announced that he supports extending the 2019 tax-filing deadline beyond April 15 because of coronavirus-induced economic disruptions. Testifying on Capitol Hill, he told the House Appropriations Committee on March 11 that his recommendation, to be delivered to President Donald Trump, would provide a “good stimulus” to small businesses and individual taxpayers.
If enacted, the move would be the latest from the federal government to delay filing requirements and abate penalties for a host of entities scrambling with the after-effects of work stoppages and slowdowns caused by the novel coronavirus. The Securities and Exchange Commission (SEC), for instance, on March 4 issued an Order providing some regulatory relief to publicly traded companies with operations in areas affected by the virus.
“We think we can provide over $200 billion of liquidity into the economy by delaying certain tax payments,” Mnuchin told members of the committee.
Individual tax returns and payments (as well as estimated quarterly payments by many businesses and self-employed individuals) are due to the Internal Revenue Service (IRS) by April 15, although taxpayers can automatically request a six-month filing extension. Even in the case of a requested extension, payments are still due on April 15.
The tax code, however, allows the Treasury secretary to delay both deadlines in disaster situations, a power most recently used last week to provide relief to those suffering from a swarm of tornadoes and severe storms in parts of Tennessee. In a March 6 announcement, the IRS extended all tax filing and payment deadlines to July 15 for individuals and businesses located in any area of Tennessee designated by the Federal Emergency Management Agency (FEMA) as qualifying for individual assistance.
Many are speculating that Mnuchin’s coronavirus recommendation to the president will be to grant similar relief to all U.S. taxpayers.
One looming tax deadline days away concerns many businesses organized as partnerships and those taxed as S-corporations: Their returns are due March 15. It is unclear whether Mnuchin’s relief would extend to the March 15 deadline.