When are business taxes due in 2020?
Given the ever-changing business climate in response to COVID-19, many business owners and operators have questions regarding the new tax filing deadlines for 2020. The CARES Act extended the due date for most 2019 business tax returns due after April 1, 2020 but before July 15, 2020 until July 15th, 2020. Most businesses use a calendar year for tax purposes. Assuming that your tax year ends December 31, 2019, your return due dates are:
S-Corporation (Form 1120s)
Original Due Date: March 15th, 2020, Extended Due Date:July 15th, 2020
Partnership (Form 1065)
Original Due Date: March 15th, 2020, Extended Due Date: July 15th, 2020
C-Corporations (Form 1120)
Original Due Date: April 15th, 2020, Extended Due Date: July 15th, 2020
Sole Proprietor (Form 1040 Schedule C)
Original Due Date: April 15th, 2020, Extended Due Date: July 15th, 2020
If you have already filed for an extension of time to file (Form 7004), your return will still be due 6 months from the original due date.
Sometimes C-Corporations choose a different tax year than the calendar year. If your tax year ends between January 1st and February 29th then your original due date is now extended to July 15th. Any other year-end dates will not be affected by the CARES Act since your original due date will be July 15th or after. You of course can still file Form 7004 for a six-month extension of time to file.
The due date for income tax payments has also been extended. If your payment was due between April 1st, 2020 and July 15th, 2020 then the payment is now due July 15th. This would apply to both regular and estimated tax payments. No penalty or interest will be assessed as long as the payments are made by July 15th. Penalty and interest will start accruing from July 16th.
Another provision of the CARES Act is the expansion of Net Operating Loss carryback rules, which were previously not available. You must act on any Net Operating Loss generated in the 2018 tax year by June 30th, 2020. You can read more about the expanded Net Operating Loss rules in this article.
Payroll tax returns and payments have not been changed by the CARES Act, however there is relieve for deferral of the employer portion of FICA. These deferrals do not cover the so-called “trust fund” portions of payroll taxes such as federal tax and FICA withheld from an employee. For more information on the payroll payment deferral options, refer to our COVID-19 page.
Lastly, any time sensitive actions that have a due date between April 1st and July 15th have been extended to July 15th. Such actions include S-Corporation election and the 60-day IRA rollover period. For a complete list of actions eligible for delay, please consult the IRS notice.
