Monday, April 5, 2021

Additional Tax Deadlines Extended To May 17 - Notice 2021-21

The IRS issued Notice 2021-21 which provides the following general relief for the filing of Forms 1040 and a limited set of other forms due on April 15, 2021:

For an Affected Taxpayer, the due date for filing Federal income tax returns in the Form 1040 series and making Federal income tax payments in connection with one of these forms having an original due date of April 15, 2021, is automatically postponed to May 17, 2021. Affected Taxpayers do not have to file any form, including Form 4868, Application for Automatic Extension of Time to File U.S. Individual Income Tax Return, to obtain this relief. This relief includes the filing of all schedules, returns, and 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. Finally, 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.

The Notice provides that interest and penalties will also not apply for that period of time for Affected Taxpayers:

         As a result of the postponement of the due date for Affected Taxpayers to file Federal income tax             returns and make Federal income tax payments from April 15, 2021, to May 17, 2021, 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 by this notice. 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.

The IRS makes clear in Notice 2021-21 is more limited than last year’s broad grant of relief.  The Notice provides:

Businesses and any other type of taxpayer who file Federal income tax returns on forms outside of the Form 1040 series are not Affected Taxpayers for purposes of the relief described in this section III.B.

No extension is provided in this notice for the payment or deposit of any other type of Federal tax, including Federal estimated income tax payments, or for the filing of any Federal return other than the Form 1040 series and the Form 5498 series for the 2020 taxable year.

There are still some April 15 deadlines. The following federal tax actions are among those that were not mentioned in the abovementioned IRS announcements and thus continue to have April 15 deadlines.

·         Paying first quarter 2021 individual estimated tax (Code Sec. 6654(c)(2))

·         Filing calendar year 2020 trust and estate income tax returns and paying any previously unpaid tax (Code Sec. 6072(a))

·         Filing 2020 calendar year C corporation income tax returns (Form 1120) and paying any previously unpaid tax (Code Sec. 6072(a))

·         Depositing calendar year corporation first installment of estimated income tax for 2021  (Code Sec. 6655(c)(2))

·         Filing Forms 990-T (Exempt Organization Business Income Tax Return), for Code Sec 401(a) or Code Sec. 408(a) trusts, for years ending 12/31/20 (2020 Instructions for Form 990-T)

·         Filing Form 1120-POL (U.S. Income Tax Return for Certain Political Organizations) for years ending 12/31/20 (Code Sec. 6072(a))

·         Filing 2020 gift tax returns and paying any gift tax (Code Sec. 6075(b)(1))

·         Filing certain generation-skipping transfer tax returns of calendar year taxpayers and paying any tax due (Reg § 26.2662-1(d)(1)(i))

·         Depositing payroll taxes for March if the monthly deposit rule applies. (Reg § 31.6302-1(c)(1))

·         Filing estate tax returns of decedents who died on July 15, 2020 and paying any estate tax that is due with the returns. (Estate tax returns must be filed within nine months after the date of the decedent's death. (Code Sec. 6075(a))

And, there are post-April 15, pre-May 17 deadlines. In addition, there are actions that continue to have deadlines that are after April 15, 2020, and before May 17, 2020 For example, for decedents who died on days from July 16, 2020, through August 16, 2020, the estate return and payment will be due before May 17, 2021. And first quarter 2021 quarterly employment tax returns will be due on April 30. (Reg § 31.6071(a)-1(a)(1))

On the IRS website: Section 965 installment payments for Form 1040 filers postponed (4/6/2021), the IRS has said that the relief provided by Notice 2021-21 also postpones the due date of an individual's section 965(h) installment payment (related to the pre-2018 Code Sec. 965 transition tax) to May 17. The IRS points out that the relief does not apply to section 965(h) installment payments with respect to taxpayers who are not Affected Taxpayers.

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