What this means for you:
- Federal deadline for filing tax returns moved to May 17th. We expect states will soon follow
- If you owe 2020 taxes, payments are now due May 17th
- We expect Q1 2021 tax estimates to be due on May 17th, rather than April 15th
Why did the IRS extend the tax filing deadline again this year?
- The IRS did not start accepting tax returns until February 12th, approximately 4 weeks later than normal
- Accounting firms are experiencing reduced staff, remote staffing, and increased difficulties due to COVID 19
- Implementation of the March 2021 Relief Bill affects several tax forms for 2020. Tax software companies are not able to update their software until the end of March. If you have unemployment benefits, this may affect you
- Accounting firms are flooded with questions from clients dealing with the third round of stimulus payments, PPP round 2, and 2021 changes to the Employment Retention Credit, which are causing additional delays in filing tax returns
As always, please reach out to a Donovan team member with any questions.