With the overwhelming news and outbreak of the COVID-19 pandemic, the deadline to pay your taxes has been extended by 90 extra days. It is a much-needed sigh of relief as health and financial uncertainty mounts.
With the help of your local McAllen CPAs at Murray & Kirchner CPA, LLC, you don’t have to deal with the pressure of filing your taxes by the deadline on your own. Today we will break down what’s expected in this payment extension, and how we can assist you in the process.
What to Expect from the Tax Extension
In a recent press conference, Treasury Secretary Steven Mnuchin stated individuals have the option to postpone as far as $1 million of tax liability, while corporations receive an extension to the extent of $10 million. Additionally, filing your taxes beyond that date may not charge interest and/or penalties.
The payment extension leaves a big mark on millions of taxpayers and is part of the Trump administration’s attempt to reduce the economic weight of the coronavirus pandemic. This delay is said to free $300 billion of assets in the economy as individuals and businesses have a better time frame to pay off their taxes.
Postponing payment requirements will not only give businesses and individuals roughly three extra months to exceed tax obligations, but also potentially diminish monetary problems that certain businesses are experiencing while more people are staying home and spending less on eating out, entertainment, and transportation.
Both Individuals and businesses are still expected to file by the 15th of April–especially to receive any applicable tax refunds in a timely manner–unless they turn in paperwork for an automatic six-month extension. The administration has also thought about pushing off the estimated quarterly tax payments that self-employed workers and businesses owe the Internal Revenue Service (IRS) during the year.
Those who are eligible for refundable tax breaks like the child tax credit and the earned income tax credit should generally file early so that they can receive a refund check sooner as well. Those who own a business or invest their funds in several partnerships may qualify for an automatic six-month extension to file since their tax returns are more complex. In a typical year, they’d have to submit 90% of their tax liability by April 15 or deal with interest and penalties for the late payment.
The IRS typically prolongs the filing deadline for natural disaster victims with no other option. For example, back in 2018, the IRS extended the due date by 24 hours when the computer system crashed on the deadline, and taxpayers had no way to submit their returns.
How Murray & Kirchner Can Help You This Tax Season
Nearly 68 million people have already completed their tax returns as of March 6, according to recent data compiled from the IRS. That only accounts for nearly 45% of the returns the agency anticipates to get this year.
Managing taxes along with the stress of the global pandemic can be a lot to process and tough to navigate through. The smallest mistake in this financial situation can be a burden, whether it’s to you or your business. If doing taxes yourself feels like too much pressure to take on, our skilled experienced McAllen CPAs can guide you through it, especially in times like these where you may need it most.
We can help take the anxieties out of filing taxes and ease the process for a fair price. You don’t have to file your taxes on your own. Be proactive and consult with Murray & Kirchner CPA, LLC, now!
To learn more about how this tax extension affects you or your business, or for help filing your taxes, chat with our certified public accountants by contacting us at (956) 800-5600 today.