IRS Formalizes 2020 Individual Tax Filing Extension

The IRS, in Notice 2021-21, has formalized a previous release extending the federal income tax filing due date for individuals for the 2020 tax year to May 17, 2021. As we have previously noted, this is an automatic extension; there is no need to file any forms or call the IRS to qualify for this extension.

Notice 2021-21 provides some additional details of the tax filing extension.

• The due date for filing federal income tax returns in the Form 1040 series (i.e., Form 1040, Form 1040-SR, Form 1040-NR, Form 1040-PR, Form 1040-SS or Form 1040(SP)) and making federal income tax payments in connection with one of these forms having an original due date of April 15, 2021 is automatically extended to May 17, 2021. This relief includes the filing of all schedules, returns or other forms that are filed as attachments to the Form 1040 series or are required to be filed by the due date of the Form 1040 series, including, for example, Schedule H and Schedule SE as well as Forms 965-A, 3520, 5329, 5471, 8621, 8858, 8865, 8915-E and 8938.

Elections that are made or required to be made on a timely filed Form 1040 series (or attachment to such form) will be timely made if filed on such form or attachment, as appropriate, on or before May 17, 2021.

As noted in our prior Alert on this subject, the period beginning on April 15, 2021 and ending on May 17, 2021 will be disregarded in the calculation of any interest, penalty or addition to tax for failure to file the federal income tax returns or to pay the federal income taxes postponed. Interest, penalties and additions to tax with respect to such postponed federal income tax filings and payments will begin to accrue on May 18, 2021.

Please note: the above relief is available solely with respect to Form 1040 series returns having an original due date of April 15, 2021, in respect of the 2020 taxable year. Businesses and any other type of taxpayer who file federal income tax returns and forms outside the Form 1040 series are not covered by this relief.

• Also postponed to May 17, 2021 is the due date for the making of 2020 contributions to individual retirement accounts (IRAs and Roth IRAs), health savings accounts, Archer Medical Savings Accounts and Coverdell education savings accounts. In addition, the time for reporting and payment of the 10% additional tax on amounts includible in gross income from 2020 distributions from IRAs or workplace-based retirement plans is automatically postponed to May 17, 2021.
• The due date for filing and furnishing Form 5498, Form 5498-ESA and Form 5498-SA (generally June 1, 2021) is postponed to June 30, 2021. The period from the original due date to June 30, 2021 is disregarded in the calculation of any penalty for failure to file those forms. Penalties with respect to a postponed filing will begin on July 1, 2021.
• Notice 2021-21 affirms that the payment of federal estimated tax is not extended. Similarly, the due date for filing any federal income return other than the Form 1040 series and the Form 5498 series for the 2020 taxable year is not extended.
• Claims for refund: Individuals with a period of limitations to file a claim for credit or refund of federal income tax expiring on or after April 15, 2021 and before May 17, 2021, have until May 17, 2021, to file those claims for credit or refund. This postponement is limited to claims for credit or refund properly filed on the Form 1040 series or on a Form 1040-X. Accordingly, the period beginning on April 15, 2021 and ending on May 17, 2021 will be disregarded in determining whether the filing of those claims is timely.

EisnerAmper will keep you informed of new developments regarding the 2020 tax year filing and payment deadlines.