Leaders are mounting pressure for income tax deadline to be extended.
House Ways and Means Committee Chairman Richard E. Neal urged the IRS to extend the deadline until July 15, noting that the pandemic is continuing to impose a “titanic strain” on the agency and taxpayers.
The National Association of Tax Professionals (NATP) is also asking for an extended tax deadline.
The American Institute of Certified Public Accountants (AICPA) sent a letter to Charles Rettig the IRS Commissioner and Acting Assistant Secretary Mark Mazur, urgently asking for the deadlines for filing all 2020 federal income tax and information returns to be extended to June 15, 2021.
The AICPA said that due to the current environment, it’s simply not possible for many taxpayers to meet with their tax advisers before the April 15 deadline for filing and payment obligations.
The pandemic has continued to cause difficult challenges and has consumed valuable time for both the IRS and tax professionals. The IRS had to delay the start of the tax season due to its involvement with the second stimulus. Tax professionals have been assisting clients with the PPP first draw loan forgiveness process which is time-consuming.
The AICPA letter stated, “We now urge Treasury and the IRS to act immediately to provide tax filing and tax payment relief for taxpayers and tax professionals affected by the ongoing pandemic.” “Specifically, we request that all 2020 Federal income tax, information returns, and payments (e.g., extension and estimated payments) originally due April 15, 2021, be granted additional time to file and pay until June 15, 2021.”
The reason for the letter urging the extended deadline was due to many circumstances that include:
- The delay of the start of the 2020 filing season until February 12. Many IRS forms are still not available for electronic filing which has also caused a delay.
- The second round of the Paycheck Protection Program (PPP) loans. A challenging rollout of the program created additional burdens.
- Tax professionals have continued to assist clients with the PPP first draw loan forgiveness process which has decreased their available time for tax return preparation.
- Additionally, changes to the Employee Retention Credit (ERC), which required possible amendment of 2020 payroll tax returns prior to filing 2020 income tax returns have consumed tax professionals’ time.
- The Coronavirus shutdown caused delayed processing of 2019 returns by the IRS which resulted in many erroneous notices that they must deal with.
- The IRS’s staffing was affected by the pandemic which limited its ability to respond to questions and notices and provide taxpayer assistance.
- Additionally, stay-at-home orders make it more difficult for people to access necessary data.
Due to many reasons, the AICPA letter stated, “Maintaining the April 15 filing and payment deadline does not reflect the real-world hardship and challenges imposed on taxpayers and tax professionals.”
David Zubler is a tax accountant and Enrolled Agent representing clients before the IRS with over 25 years of tax experience. He is the author of four tax books and is the founder and president of Your Tax Care. The company provides business and tax education to the public at its website, YourTaxCare.com. David can also be contacted by email at firstname.lastname@example.org