Extensions anyone? Yes, please! Last week, IRS released additional details on its recent decision to extend certain tax filing deadlines to May 17, 2021. Last week also saw the signing of legislation that extends the popular Paycheck Protection Program (PPP).
Select Tax Due Dates Extended
On March 29th, IRS published guidance on the extension of certain tax deadlines from April 15, 2021 to May 17, 2021. The guidance emphasizes that only Form 1040 series forms and accompanying schedules are eligible for the extension, including Form 1040, 1040-SR, 1040-NR, 1040-PR, 1040-SS and 1040(SP). Any tax liability due with these forms can be paid by May 17, 2021 without incurring penalties and interest.
Note that other popular forms including Form 1120, 1041 and 709 are not included in the extension. 2020 calendar year tax liabilities due with these forms must be paid by April 15 to avoid late payment penalties and interest. Also, 2021 first quarter estimated tax payments continue to be due April 15.
The May 17th extension also applies to refund claims that would expire on or after April 15, 2021 and before May 17, 2021.
IRS guidance also extends the time to make 2020 contributions to IRAs, HSAs, Archer MSAs and Coverdell ESAs from April 15, 2021 to May 17, 2021.
Most states, including Indiana, have followed the IRS in extending the original due date for individual income tax returns to May 17, 2021.
Last Tuesday, President Biden signed into law a bill that extends the PPP through May 31, 2021. The program was set to expire on March 31. The PPP Extension Act extends the deadline for borrowers to submit PPP applications by 60 days while also providing the SBA an additional 30 days to finish processing applications received by May 31.
While the extension is certainly welcomed, the Act did not provide additional funds for the popular program. At current lending rates, funds are expected to run out by mid- to late-April.
Questions about the due date extension? Need assistance with PPP? We are here to assist. Please give us a call.