The 2020 tax season has been upended by the novel coronavirus, forcing the IRS to extend more filing deadlines for individuals and businesses. The agency has also launched an online tool to help non-filers get their tax stimulus payment sooner. Another Web-based tool is scheduled to debut next week that will allow people to track how soon they’ll receive their stimulus money.
As part of the $2 trillion stimulus package, eligible taxpayers who filed tax returns for either 2019 or 2018 will get refund rebates of up to $1,200 for individuals or $2,400 for married couples. Those who qualify for a stimulus payment get an extra $500 for each qualifying child under 17. The economic impact payments will either be delivered via direct deposit or mailed. Payments will be distributed automatically to most people starting next week, the IRS said.
There has been a lot of concern that many people who aren’t required to file a tax return will have to wait for their payments. The covid-19 pandemic and associated stay-at-home orders have made it difficult for people to meet with tax professionals to help them prepare their returns. For example, AARP Foundation suspended its free Tax-Aide service until further notice out of concern of spreading the coronavirus. Nearly 60 percent of all taxpayers turn to a tax practitioner to prepare and file their returns, according to the American Institute of Certified Public Accountants (AICPA).
To get their stimulus payments, non-filers have to file a tax return. But now they can use the new online tool, developed with the IRS-backed Free File Alliance, to answer a few basic questions to get their money. The tool is based on the Free File Fillable forms available on the IRS website.
To get to the portal, go to IRS.gov and look for “Non-Filers: Enter Payment Info Here.” The link will take people to a page where they have to provide such information such as their Social Security number, address, and dependents. Non-filers can also provide direct deposit information, which will reduce the time it takes to receive their money.
The new feature is targeted to people who typically don’t have to file a federal return, which may include filers earning under $12,200 and married couples earning less than $24,400 last year.
Individuals who receive Social Security retirement, survivors or disability benefits or Railroad Retirement benefits will automatically receive the $1,200 stimulus payment if eligible. However, if you fall into one of those categories and have qualifying children under 17, use the non-filer tool to claim the $500 payment per child. You’ll need a valid Social Security number or Adoption Taxpayer Identification Number for each dependent.
By April 17, the agency plans to launch “Get My Payment,” which will provide people with a status of their payment, how it will be sent — direct deposit or mailed check — and the date the money will be mailed or scheduled to be deposited into their bank account. The tool will be much like the current “Where’s My Refund,” which allows taxpayers to track their federal refund.
An additional feature on “Get My Payment” will allow taxpayers to provide their bank account information so they can receive their payment faster than a paper check. If a payment has already been scheduled, you can’t use this feature, the IRS said.
The IRS also announced it was pushing the tax deadline for June 15 quarterly estimated tax payments to July 15. In addition, trusts, estates, corporations and other noncorporate tax filers will get extra time with their deadlines moving to the July 15 date, the IRS said. Americans who live and work abroad also qualify for the July 15 filing and payment extension. The Treasury Department has already given taxpayers until July 15 to file their federal returns and pay their tax bill.
Extensions now generally apply to all taxpayers who face a filing or payment deadline between April 1 and July 15. No interest will be charged because of the delay nor will taxpayers be hit with a late-filing penalty or late-payment penalty.
If you need time to file your individual return, you still can request an extension to Oct. 15 by filing Form 4868. However, unless there’s a further deadline delay, filing an extension does not mean you have more time to pay your tax bill. It would still be due July 15.
The deadline extensions also now include people who haven’t filed 2016 returns, which would have been due April 15 if claiming a refund. They now have until July 15. The law provides a three-year window of opportunity to claim a refund. If taxpayers do not file a return within three years, the money becomes property of the U.S. Treasury. Unclaimed income tax refunds worth more than $1.5 billion await an estimated 1.4 million taxpayers who did not file a 2016 Form 1040 federal income tax return, according to the IRS.
It’s important to note that your state taxing authority may still require you to file and pay your taxes on time, although many states plan to follow the federal government’s lead in granting extensions. The AICPA is keeping a regularly updated list of states’ tax relief efforts at aicpa.org. Search for “State Tax Filing Relief Chart for Coronavirus.” The state filing relief chart was last updated April 10.
Taxpayers in states that don’t move filing deadlines to match the federal extension may find they still have to file by April 15. You may need to file your federal return before you can file your state return.
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