On Tuesday March 17th, Treasury Secretary Steven Mnuchin announced that individual tax payers get a ninety day reprieve to pay the income tax they owe, making the revised federal tax filing deadline July 17th, 2020. This applies to individual filers who are due to pay up to $1 million in taxes. Corporate filers get the same length of time to pay up to amounts due on up to $10 million in taxes.
During that three-month deferral period, taxpayers won’t be subject to interest and penalties.
This applies to Federal taxes, while each state is making its own deferral decisions. California has announced a 60 day deferral, making June 15th, 2020 the new state filing deadline.
Feeling relieved? Did you readily decide to delay your filings? Before you do, consider these top 4 things as the revised deadlines might NOT be the right choice for you.
- Need a refund? If you are in a position to gain a refund, there is no reason to delay in filing your taxes. The sooner you file, the sooner your refund can be sent to you. In a world of uncertainty, who knows if the IRS may see a shutdown – which would mean a delay in your refund. So, for those positioned for a refund – the time to file is now.
- Looking to refinance? If you are looking to do so, you will need to supply tax returns. This means the sooner you file the sooner you will have access to these necessary documents.
- Interested in potential bailout funds or government assistance? Again, in this situation you will most likely need to supply tax returns, so the sooner you file the sooner you will have these readily available.
- Commercial credit lines of interest? We are in unchartered waters. However memories of 2008 loom when we saw many commercial credit lines pulled from businesses. As the window of opportunity may close to obtain commercial credit lines, now is the time to take advantage of what is available. Part of the commercial credit lending process involves current tax returns, so yet again, delaying your filings may not be the wisest choice.
One thing that remains certain is this – the team at Semaphore is here, accessible, and working round the clock to support our clients. When we say “we’ve got your back”, we mean it. We will remain committed to exceptional service, support and unbiased information to help our clientele navigate this turbulence so we can all move forward to brighter horizons.