As citizens and business owners reel from the economic impact which the COVID-19 virus has created in the US, several state and local governing bodies have begun to roll out tax relief initiatives. Thanks to Thomson Reuters for this preliminary list of those efforts.
Alabama - The Alabama Department of Revenue has announced that, effective immediately, it is extending relief to small retail businesses that are unable to timely pay their February, March, and April sales tax liabilities. Specifically, small businesses whose monthly retail sales during the previous calendar year averaged $62,500 or less may file their monthly sales tax returns for the February, March, and April 2020 reporting periods without paying the state sales tax reported as due. Late payment penalties will be waived for these taxpayers through June 1, 2020. Similar sales tax relief may be available on a case-by-case basis to other businesses significantly impacted by COVID-19 and the preventative measures being taken to limit its spread in Alabama. Taxpayers seeking additional information are advised to visit the Department website's "COVID-19 Updates" page or call the Sales and Use Tax Division at (334)-242-1490.
California - The California Employment Development Department (EDD) has announced that employers statewide directly affected by COVID-19 may request up to a 60-day extension of time from the EDD to file their state payroll reports and/or deposit payroll taxes without penalty or interest. A written request for an extension must be received within 60 days from the original delinquent date of the payment or return.
Governor Gavin Newsom issued on March 12, 2020, an executive order regarding California's response to the COVID-19 pandemic. The executive order, which is effective immediately, orders, among other things, that: (1) to quickly provide relief from penalties and interest, the provisions of the Revenue and Taxation Code that apply to the taxes and fees administered by the California Department of Tax and Fee Administration (CDTFA), requiring the filing of a statement under penalty of perjury setting forth the facts for a claim for relief, are suspended for a period of 60 days after the date of the order for any individuals or businesses who are unable to file a timely return or make a timely payment as a result of complying with state or local public health officials imposition or recommendation of social distancing measures related to COVID-19; and (2) the Franchise Tax Board (FTB), the State Board of Equalization (SBE), the CDTFA, and the Office of Tax Appeals (OTA) shall use their administrative powers where appropriate to provide those individuals and businesses impacted by complying with a state or local public health official's imposition or recommendation of social distancing measures related to COVID-19 with the extensions for filing, payment, audits, billing, notices, assessments, claims for refund, and relief from subsequent penalties and interest.
During the 60-day window specified in Governor Newsom's executive order on the COVID-19 pandemic (see previous paragraph), the CDTFA has posted on its website an alert in which it advises that it has been able to make it easier for such taxpayers and fee payers to request relief from the imposition of interest and penalties. They can go through the CDTFA's normal online process for requesting relief, they can send a letter (a link to the CDTFA's office locations and addresses is provided), or they can call the CDTFA's call center at (800) 400-7115.
The FTB has announced (1) special tax relief for California taxpayers affected by the COVID-19 pandemic; and (2) has answered frequently asked questions (FAQs) related to that relief. Regarding (1), affected taxpayers are granted an extension to file 2019 California tax returns and make certain payments until June 15, 2020, in line with Governor Newsom's March 12 Executive Order. This reliefincludes moving the various tax filing and payment deadlines that occur on March 15, 2020, through June 15, 2020, to June 15, 2020, and includes the following: (a) partnerships and limited liability companies (LLCs) that are taxed as partnerships whose tax returns are due on March 15 now have a 90-day extension to file and pay by June 15; (b) individual filers whose tax returns are due on April 15 now have a 60-day extension to file and pay by June 15; and (c) quarterly estimated tax payments due on April 15 now have a 60-day extension to pay by June 15. The FTB's June 15 extended due date maybe pushed back even further if the Internal Revenue Service (IRS) grants a longer relief period.
Taxpayers claiming the special COVID-19 relief should write the name of the state of emergency (for example, COVID-19) in black ink at the top of the tax return, and if they are e-filing, they should follow the software instructions to enter disaster information. The FTB also will waive interest and any late filing or late payment penalties that would otherwise apply. Regarding (2), the FTB has answered the following FAQs: (a) What business entities qualify for the June 15, 2020, extended deadline to file and pay taxes? (b) How does the FTB define who is "affected by the COVID-19 pandemic"? (c) How would those affected by it demonstrate they are affected by it?
The CDTFA has done the following: (1) created a COVID-19 state of emergency webpage; and (2) added COVID-19 to the list of disasters for which state of emergency tax or fee relief is available. Regarding (1), on March 12, 2020, Governor Newsom issued an Executive Order in response to the COVID-19 State of Emergency. Pursuant to this Executive Order, through May 11, 2020, the CDTFA has the authority to assist individuals and businesses impacted by complying with a state or local public health official's imposition or recommendation of social distancing measures related to COVID-19. This assistance includes granting extensions for filing returns and making payments, relief from interest and penalties, and filing a claim for refund. Taxpayers may request assistance by contacting the CDTFA through its online services , by sending a letter, by email, or by phone. Regarding (2), the CDTFA's emergency tax or fee relief is available for business owners and feepayers directly affected by disasters declared as state of emergencies over the past three years, may include extension of tax return due dates, relief of penalty and interest, or replacement copies of records lost due to disasters. An extension of up to three months to file and pay taxes is available in 32 of the programs administered by the CDTFA (including sales and use tax, various fuel taxes, and cigarette and tobacco products taxes) for taxpayers directly affected by COVID-19 who, as a result, cannot meet their filing and payment deadlines.
Affected taxpayers may apply online for relief from penalties and interest and request online a filing extension. Business owners and fee payers who need to obtain copies of CDTFA tax records will be able to receive replacements free of charge.
In response to COVID-19, San Francisco Mayor London Breed has announced various measures to support small businesses, including a deferral of business taxes. In order to provide immediate cash-flow assistance to small businesses, the mayor will be working with Treasurer Jose Cisneros to notify them that the next round of quarterly businesses taxes can be deferred. Businesses are required to pre-pay their first quarter business taxes for the current tax year by April 30, 2020. This announcement will allow businesses to not pre-pay, deferring payment due to February 2021. No interest payments, fees, or fines will accrue as a result of the deferral. This benefit will be offered to business with up to $10 million in gross receipts.
Connecticut - The Connecticut Department of Revenue Services (DRS) is granting automatic extensions of Connecticut filing deadlines for certain annual tax returns due on or after March 15, 2020 in order to support businesses during the COVID-19 outbreak effective immediately. The extensions impact the corporation business tax return, the pass-through entity tax return and the unrelated business income tax return. Individuals in the process of preparing their Connecticut income tax returns (Form CT-1040) due April 15, 2020 are advised that DRS will adjust due dates for filing and payment of state income taxes to align with any specific, actionable announcement from the Internal Revenue Service regarding due dates for the filing and payment of federal income taxes.
Effective immediately, the filing deadlines for various annual tax returns due on or after March 15, 2020, and before June 1, 2020, are extended by at least 30 days. In addition, the payments associated with these returns are also extended to the corresponding due date in June.
The filing date for the 2019 Forms CT-1120 and CT-1120CUConnecticut corporation business tax return is extended to June 15, 2020 and the payment deadline is extended to June 15, 2020. The filing date for the 2019 Form CT-1065/CT-1120 SI Connecticut pass-through entity tax return is extended to April 15, 2020 and the payment deadline is extended to June 15, 2020. The filing date for the 2019 Form CT-990T Connecticut unrelated business income tax return is extended to June 15, 2020, while the payment deadline is extended until June 15, 2020.
Illinois - The Illinois Attorney General issued an important notice that, due to closures related to COVID-19, estates with returns and payments due between March 16, 2020 and April 15, 2020 will receive a 30-day extension for filing and payment. An extension of time to pay does not waive or abatestatutory interest. Payments must be sent to the Illinois State Treasurer, using a fillable form to makepayment of the Illinois Estate Tax, which can be downloaded from the Treasurer's website. Staff may not be available to receive returns in person at the Springfield office.
Taxpayers filing returns in Chicago should use the James R Thompson Center through the Lake Street entrance; however, taxpayers are encouraged to file returns and extension requests by mail. Cook, DuPage, Lake, and McHenry counties should file with the Chicago office, and all other counties should file with the Springfield office.
Indiana - The Indiana Department of Revenue continues to monitor the Internal Revenue Service regarding possible changes to filing and payment due dates, and is preparing to follow suit. Those decisions will be shared as soon as they are made.
Louisiana - Louisiana Governor John Bel Edwards has issued a proclamation regarding measures for the COVID-19 public health emergency, which affects certain legal tax proceedings. Legal deadlines, including liberative prescription and preemptive periods applicable to legal proceedings in all courts, administrative agencies, and boards, are suspended until at least Monday, April 13, 2020, including any such deadlines set forth within Title 47 of the Louisiana Revised Statutes, Revenue and Taxation.
Maryland - Maryland Comptroller Peter Franchot announced that business-related tax filing deadlines are extended to June 1, 2020. The extension is intended to assist businesses affected by the economic impact of the coronavirus (COVID-19). The extension applies to certain business returns with due dates during the months of March, April, and May 2020 for businesses filing the following returns: sales and use tax; withholding tax; admissions and amusement tax; alcohol tax; tobacco tax; motor fuel excise tax; tire recycling fee; and the bay restoration fee. Business taxpayers who file and pay by the extended due date will receive a waiver of interest and penalties. However, filing due dates for Maryland corporate and individual income tax returns will be extended if the IRS extends its April 15, 2020 filing deadline.
Businesses with extension-related questions can call the Comptroller's Ombudsman at (410) 260-4020, or send an email to firstname.lastname@example.org. No interest or penalty for late income tax payments will be imposed if Maryland business and individual income taxpayers make 2019 tax payments by July 15, 2020. Maryland is following the relief provided by the federal government's 90-day extension of the April 15, 2020 deadline for federal income tax payments because of COVID-19. Fiscal year filers with tax years ending January 1, 2020 through March 31, 2020 are also eligible for the payments extension.
However, taxpayers who take advantage of the federal extension to file their return, which is separate from the relief granted to pay their taxes, will continue to be automatically granted an extension on their Maryland tax filings. No additional filing extension forms are required.
Michigan - Due to the disruptions to the normal business operations of many sales, use, and withholding taxpayers required to file returns and remit tax by the 20th day of each month due to the COVID-19 outbreak, the Department of Treasury is waiving penalty and interest for the late payment of tax or the late filing of the return due on March 20, 2020. The waiver will be effective for a period of 30 days; therefore, any return or payment currently due on March 20, 2020 may be submitted to the Department without penalty or interest through April 20, 2020. The waiver is limited to sales, use, and withholding payments and returns due March 20, 2020. Any payment or return otherwise due after that date will not be eligible for the current waiver. The waiver is not available for accelerated sales, use, or withholding tax filers. Those taxpayers should continue to file returns and remit any tax due as of the original due dates.
Minnesota - The Minnesota Department of Revenue has announced that the income tax deadline has not changed. At this time, federal and Minnesota individual income tax returns are due April 15, 2020. The Department is monitoring actions by the Internal Revenue Service and will update this information as necessary. If COVID-19 impacts the ability of a taxpayer to file and pay his or her taxes on time, Minnesota law allows taxpayers to request an abatement of any penalty or interest imposed for failing to timely file a return or failing to timely pay a tax for good cause. If a taxpayer is unable to file and pay on time because of COVID-19 illness or related situation, the taxpayer should contact the Department.
North Carolina - The North Carolina Department of Revenue has issued an important notice to inform taxpayers who have been affected by COVID-19 of a limited-time waiver of certain penalties. On March 10, 2020, North Carolina Governor Roy Cooper signed Executive Order 116 declaring a state of emergency in response to COVID-19. The Secretary has become aware that, because of COVID-19, some taxpayers may not be able to meet certain filing or payment requirements. In response, the Secretary has elected to waive the following penalties: the penalty for failure to obtain a license; the penalty for failure to file a return; the penalty for failure to pay tax when due; and the penalties regarding informational returns. The waiver applies to the failure to timely obtain a license, file a return, or pay a tax that is due between March 15, 2020, and March 31, 2020, if the license is obtained, the return or extension application is filed, or the tax is paid by April 15, 2020. The waiver will be considered a waiver for special circumstances. The waiver will not be considered a waiver for good compliance that can only be granted once every three years per tax type. Affected taxpayers who cannot meet their filing or payment requirement as a result of COVID-19 should complete Form NC-5500 and write "COVID-19" on the top of the form. For affected taxpayers who do not have access to Form NC-5500, they can request a penalty waiver by attaching a letter containing: the taxpayer's name; address; SSN or FEIN; Account ID; and the tax type and tax period for which the taxpayer seeks waiver of penalty. Form NC-5500 or the letter should be mailed to the North Carolina Department of Revenue, Customer Service, P.O. Box 1168, Raleigh, NC 27602.
Oklahoma - The Oklahoma Governor, J. Kevin Stitt, ordered the temporary suspension of the costs and fees for oversize/overweight permits required of carriers whose sole purpose is transportation of materials, equipment, and supplies used for direct assistance in support of emergency relief efforts which would normally require an overweight permit in response to the COVID-19 outbreaks.
Oregon - The Oregon Department of Revenue has provided guidance on the tax relief it is offering taxpayers due to the COVID-19 pandemic. With regard to the corporate activity tax (CAT), since the pandemic may impact commercial activity to an extent that makes it difficult for businesses to estimate their first CAT payment, due April 30, 2020, the Department will not assess underpayment penalties on taxpayers making a good faith effort to estimate their first quarter payments. With regard to the personal income tax, at this time, taxpayers may file federal filing extension Form 4868 before the due date with the IRS and Oregon will automatically grant a filing extension for the Oregon return; these extensions are not extended to payment due dates. If the IRS declares the April 15 due date extended due to the COVID-19 pandemic, Oregon will automatically connect to those dates for personal income tax filers.
The Department may waive penalties for late payment if the delinquency is due to a circumstance beyond the taxpayer's control. Estimated payment due dates for personal income tax are not extended in Oregon, but interest will not be imposed on an underpayment of estimated tax if the Department determines that by reason of casualty, disaster or other unusual circumstances the imposition of interest would be against equity and good conscience. With regard to other tax programs administered by the Department, if an action of the IRS or a state-declared emergency will impair the ability of either Oregon taxpayers or the state to take action required within the time required by law, the Department may extend any statutory period of limitation on any tax that it collects. If the Department makes such a decision, an order will be issued and announced, and filed with the Secretary of State.
Texas - Texas Comptroller Glenn Hegar reminds businesses that the sales tax collected in February 2020 must be remitted by March 20, 2020. Although this may be difficult for businesses due to COVID-19, the tax represents money collected from individual Texans and expected to be available to provide emergency health care and support other emergency operations. The comptroller urges businesses to make use of the agency's online tools to meet the March 20 deadline. For taxpayers who must visit the agency's field offices, protocols have been put in place to ensure proper social distancing and protect the safety of both taxpayers and agency employees. Future tax due dates will be examined as they approach.
Utah - The Utah State Tax Commission has announced the following changes to comply with recommendations to help slow down the spread of COVID-19: (1) the due date of the Utah individual income tax return is the same day as the due date of the federal individual income tax return; if the IRS changes the due date due to the outbreak, Utah's due date will also be extended; (2) the due dates of Utah corporate and pass-through entities is set by state statute and will not be affected by IRS changes in the due dates for those returns without action by the legislature; (3) telephone agents will be available at (801) 297-2200 or (800) 662-4335 for assistance Monday through Friday, 8:00 a.m. - 5:00 p.m and counter agents will only be available for immediate lien release with certified funds (cashier's check or cash) and cash payments; (4) e-filed returns with refunds will not be delayed; (5) all scheduled tax appeals hearings will be held by telephone from March 23 through April 24, 2020; due to COVID-19 precautions, the Tax Commission will hold all events as scheduled, but will hold the events via telephone conference only; and (6) Property Tax Division functions will continue without interruption with email being the best form of communication.