Late Friday, the IRS issued Notice 2020-18, which supersedes its prior guidance, Notice 2020-17, issued two days earlier. https://www.irs.gov/pub/irs-drop/n-20-18.pdf.

Notice 2020-18 confirms that the extension from April 15 to July 15 applies to all taxpayers. The notice can be summarized as follows:

– Type of taxpayer – It applies to all individuals, trusts, estates, C corporations, S corporations reporting entity level tax, and partnerships.

– Type of returns – It applies to all federal income tax returns due April 15, 2020.

– Extension. Taxpayers do not need to file an extension request under Forms 4868 or 7004.

– Income taxes – It applies to all federal income tax payments (including payments of tax on self-employment income) due April 15, 2020, including estimated income tax payments due April 15, 2020.

The notice and the extension of time to pay does not apply to second quarter estimated tax payments due June 15, 2020.

There is no limit on the amount of the payments that may be extended. Prior guidance set a $1,000,000 limit.

What is does not apply to:

– It does not apply to estate or gift taxes.

– Form 8752 payments due May 15. Partnerships and S-corporations with a fiscal year-end, must use form 8752 to figure and report the required tax payment due on account of the deferral period.

– It does not apply to tax payments reportable on Form 965, relating to the repatriation tax of 2017.

Interest & Penalties – Interest and penalties on unpaid taxes will begin to accrue on July 16, 2020.

Other observations:

Notice 2020-18 is for federal income taxes only. Some states will piggyback off the approach taken by the federal government, but some will make their own rules. The AICPA has published a helpful chart listing state guidance related to the coronavirus pandemic.

https://www.aicpa.org/content/dam/aicpa/advocacy/tax/downloadabledocuments/coronavirus-state-filing-relief.pdf

The above is subject to change and other responses to the economic effects of the pandemic are still being formulated.