In accordance with its earlier announcement on March 17, the IRS issued detailed guidance on Monday about its postponement of the April 15 tax deadline for individuals. This automatic extension has good implication on various computation related to interest and penalty.
What has been postponed to May 17th ?
- The last date to file the federal individual income tax return on Form 1040, 1040-SR, 1040-NR, 1040-PR, 1040-SS, or 1040(SP) including all schedules and other forms that are filed as an attachment or
- It also means any federal tax payment reported on one of these forms that would otherwise be due April 15, 2021, is also extended to 17th May 2021.
- The IRS notice says that elections that are made or required to be made on a timely filed form in the Form 1040 series (or attachment to the form) will be considered timely if filed on such form or attachment, as appropriate, on or before May 17, 2021.
- The time for contributions to IRAs and Roth IRAs, health savings accounts (HSAs), Archer Medical Savings Accounts (Archer MSAs), and Coverdell education savings accounts (Coverdell ESAs) extended to May 17.
- The notice also extends the postponement to claims for credit or refund of federal income tax that absent the notice would expire on or after April 15, 2021, and before May 17, 2021 (this generally affects 2017 tax years).
- The postponement also applies to individuals who are required to file and furnish Form 5498, IRA Contribution Information; Form 5498-ESA, Coverdell ESA Contribution Information; or Form 5498-SA, HSA, Archer MSA, or Medicare Advantage MSA Information, (the Form 5498 series) that would generally be due June 1, 2021. That deadline is postponed to June 30, 2021.
What has not been postponed ?
- The IRS notice only applies to individuals and so it does not apply to any other type of taxpayer or federal tax return.
- The time to pay the estimated tax remains April 15, 2021. It is not extended
What I need to know more ?
Since filing deadline is automatically extended to 17th May , you do not need to apply for an extension up to 17th May. But if you think you are not able to file a tax return, you may have to file Form 4868, Application for Automatic Extension of Time to File U.S. Individual Income Tax Return, to obtain an extension beyond 17th May
The period beginning April 15, 2021, and ending on May 17, 2021, shall not be taken for calculating 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 the notice.
You can read the IRS Notice 2021-21 for details.