In response to the COVID-19 (coronavirus) pandemic, the IRS and the U.S. Department of the Treasury announced that individuals who owe taxes for 2019 can defer up to $1 million in payments for 90 days past the April 15 deadline. Corporations can defer taxes owed up to $10 million for the same length of time. There will be no interest or penalties on those delayed payments.
The deadline to file federal tax returns has also been extended to July 15, three months after the normal April 15 deadline.
For state tax returns, some states, such as California, have extended tax return filing and payment deadlines. It is important to check with individual states for current guidance.
In addition to the above tax extensions, the government is also developing an economic relief package for all Americans that could total $1 trillion. Those relief efforts may include payments of $1,000 to every adult and $500 to every child.
Cresset’s advisors are closely tracking the government’s response to the pandemic and are working with clients to answer their questions and develop strategies that best position them for this challenging environment.