Among the unexpected challenges our nation faces in dealing with the coronavirus, it comes at a time when accounting professionals and individuals alike face the annual challenge to timely file income tax returns under the best of circumstances. For couples in the process of divorce, ordinary challenges become extraordinary challenges.
For those balancing social distancing and the consequences on family and career, we have good news to share! The United States Treasury announced measures to defer 2019 tax payments in reaction to the coronavirus outbreak. Dates, deadlines and facts to note and to discuss with your tax preparer are as follows:
1. Payment Date Change: The due date for payments moves from April 15, 2020 to July 15, 2020.
2. Payment Deferral Amount: Individuals may differ up to $1 million in tax payments to the Internal Revenue Service. Corporations may defer up to $10 million in tax payments.
3. Payment Deferral Consequences: All deferrals will be interest-free and penalty free.
4. April 15, 2020 Filing Date Not Yet Extended: The deadline to file returns has NOT yet been extended although some lawmakers urge a filing extension as a next step.
5. 2020 Quarterly Estimated Payment Due Dates Not Yet Extended: The measure did not discuss deferral of quarterly estimated tax payments for 2020 so continue to plan for those payments.
As with any joint tax filing made during a divorce when a couple may not be sharing information about finances that flows into tax filings, the coronavirus should not affect documenting indemnifications. Indemnifications document each individual taking responsibility for the consequences of his or her reporting or failing to report accurate income and deductions.
The attorneys of Schiller DuCanto & Fleck LLP regularly provide counsel in these matters and remain available, crisis notwithstanding. To learn more about our tax and financial planning practice area, visit here.