Tax filing deadline set for July 15
The COVID-19 pandemic has been good for those who enjoy procrastinating on filing their tax returns. But the deadline is finally coming up, as the Department of the Treasury and IRS announced Monday it will not extend the July 15 deadline for tax filing and payment.
The deadline was originally scheduled for April 15 but was pushed back three months due to the novel coronavirus pandemic, which caused many businesses to be closed and millions to be temporary out of work.
Athens accountant George Feigley, of Johnson, Feigley and Newton, said he hasn’t seen a huge influx of business with the deadline coming up, but that could change as it gets closer.
“For us it’s been pretty steady,” Feigley said. “We’re getting a few more coming in now, but we still had a lot of people file by April 15. Of course, if you’re getting a refund, you’re going to want to file as quickly as possible.”
Those who aren’t able to file by July 15 can request an automatic extension of time to file until Oct. 15. However, Feigley said someone who owes taxes and requests and extension will be have to pay a 0.5% a month late penalty plus interest from July 15 until they file.
“If you don’t get that approved extension, it goes up to 5% a month,” he said. “So it’s important if you can’t file, get an approved extension.”
To get an extension, taxpayers must estimate their tax liability on the extension form and pay any liability.
Taxpayers who owe taxes can choose several options to pay their taxes, the IRS said in a press release. They can either use IRS Direct Pay, pay by Electronic Federal Tax Payment System by phone or online, make a debit or credit care payment or pay by check or money order.
The IRS recommends taxpayers who are unable to pay their taxes in full should act as quickly as possible. Tax bills can quickly accumulate more interest and penalties the longer they sit.
The IRS said several payment options are available on IRS.gov/payments to help taxpayers who can’t pay in full, and some can offer taxpayers smaller penalties. Though interest and late-payment penalties continue to accrue on any unpaid taxes after July 15, the failure to pay tax penalty rate is cut in half while an installment agreement is in effect. The usual penalty rate of 0.5% per month is reduced to 0.25%. For the calendar quarter beginning July 1, the interest rate for underpayment is 3%, the IRS said.
The state deadlines are not necessarily the same as federal, but Feigley said Alabama’s tax deadline is also July 15 with the late filing deadline still Oct. 15.
“The state is doing the same thing the federal is doing,” he said. “You have to get a federal extension and a state extension (if you need one). The penalties are different for the state, but if you don’t pay what you owe the state by July 15, then you will owe interest and penalties until the time you file. You still have to get the approved extension to get the lesser penalty.”