From social distancing to cancellation of large gatherings to prohibitions on travel, the COVID-19 pandemic has caused unprecedented disruptions in daily life. Governments are taking steps not only to “flatten the curve” and mitigate the public health effects of the outbreak but also provide financial relief to mitigate its economic effects.
Today, as part of its response to the COVID-19 pandemic, the U.S. Treasury Department announced a 90-day delay of the traditional April 15th income tax payment deadline to July 15th, 2020. Treasury Secretary Steven Mnuchin stated that individual taxpayers will be given the additional 90 days to pay up to $1 million in income taxes without interest or penalties. This move is intended to cover many pass-through entities and small businesses, which are more likely to owe federal income taxes on the April 15th deadline. Corporate taxpayers will be allowed the same 90-day extension to pay up to $10 million in taxes owed without interest or penalties.
Several states, including California and Massachusetts, have already announced similar deferrals of state income tax filing and payment deadlines or indicated that they will follow relief given at the federal level. North Carolina has not yet made such an announcement.
We at Smith Debnam are monitoring this situation closely as part of our comprehensive response to the COVID-19 pandemic. If you have any questions, please contact us.