Both the Internal Revenue Service (IRS) and the California Franchise Tax Board (FTB) have postponed the filing and payment deadline for individual taxpayers to file returns this year to May 17.
IRS officials say individual taxpayers can postpone federal income tax payments for the 2020 tax year without penalties and interest, regardless of the amount owed. This postponement applies to individual taxpayers, including individuals who pay self-employment tax.
Penalties, interest and additions to tax will begin to accrue on any remaining unpaid balances as of May 17, 2021. Individual taxpayers will automatically avoid interest and penalties on the taxes paid by May 17.
“This continues to be a tough time for many people, and the IRS wants to continue to do everything possible to help taxpayers navigate the unusual circumstances related to the pandemic, while also working on important tax administration responsibilities,” IRS Commissioner Chuck Rettig said.
“Even with the new deadline, we urge taxpayers to consider filing as soon as possible, especially those who are owed refunds. Filing electronically with direct deposit is the quickest way to get refunds, and it can help some taxpayers more quickly receive any remaining stimulus payments they may be entitled to.”
Individual taxpayers do not need to file any forms or call the IRS to qualify for this automatic federal tax filing and payment relief. Individual taxpayers who need additional time to file beyond the May 17 deadline can request a filing extension until Oct. 15 by filing Form 4868 through their tax professional, tax software or using the Free File link on IRS.gov.
Filing Form 4868 gives taxpayers until October 15 to file their 2020 tax return but does not grant an extension of time to pay taxes due. Taxpayers should pay their federal income tax due by May 17, 2021, to avoid interest and penalties.
Taxes must be paid as taxpayers earn or receive income during the year, either through withholding or estimated tax payments.
In general, estimated tax payments are made quarterly to the IRS by people whose income isn’t subject to income tax withholding, including self-employment income, interest, dividends, alimony or rental income. Most taxpayers automatically have their taxes withheld from their paychecks and submitted to the IRS by their employer.
The IRS urges taxpayers who are due a refund to file as soon as possible. Most tax refunds associated with e-filed returns are issued within 21 days.
Controller Betty T. Yee, who serves as chair of FTB, also acknowledged 2020 being “a challenging year” for California taxpayers in announcing the state’s deadline extension.
“I am pleased we are able to postpone tax filing and payment deadlines for all individual taxpayers in California to May 17,” Yee said. “Hopefully, this small measure of relief will continue to allow people to focus on their health and safety and navigate the complexities caused by the pandemic.”
Like with the federal tax returns, the state’s postponement applies to individual filers whose 2020 tax returns and payments were originally due on April 15, 2021. Taxpayers do not need to claim any special treatment or call FTB to qualify for this postponement.
The FTB will waive any interest and late payment penalties that would otherwise apply if the returns are filed and the payments are made by May 17, officials said.
The postponement only applies to individual taxpayers, and it does not apply to estimated tax payments, which are still due on April 15.
During the public health emergency, the FTB will continue to process tax returns, issue refunds, and provide phone and live chat service to taxpayers needing assistance.
If possible, taxpayers should continue to file tax returns as soon as possible to get fast refunds and to claim any applicable credits, including the California Earned Income Tax Credit (CalEITC) and the Young Child Tax Credit.
Those receiving CalEITC, and others who file with an Individual Taxpayer Identification Number (ITIN) and had $75,000 or less in income last year, may be eligible for a Golden Gate Stimulus payment of $600 or $1,200, upon filing their 2020 tax return.