As we grapple with an international pandemic and the economic instability that has brought about, you could be forgiven for thinking you had enough on your plate. But it's almost tax time again.

If you've already managed to file and pay your 2019 taxes, then this article has nothing more to add - give yourself a pat on the back. But if you haven't registered your taxes yet, you must start prepping today.

In March, the IRS announced an extension to the standard April 15 tax deadline: the new date is a now quickly approaching, July 15, 2020.

For the 2019 tax year, the IRS has adjusted the individual income brackets for inflation. There are also new regulations for a standard deduction, 401(k), and health savings account.

WHAT IS TAX DAY?

As of the date of this posting, the Treasury Secretary Steven Mnuchin announced that many Americans could defer their tax filing and payment of taxes owed until July 15, 2020.

The IRS has also highlighted that taking the extra 90-day opportunity won't incur any interest or penalty charges.

WHEN ARE TAXES DUE IF YOU GET AN EXTENSION?

If you applied for an extension in previous years, you would have been able to file your tax return in October. However, with the COVID-19 outbreak causing untold havoc for companies, the IRS pushed the filing deadline to July 15.

You can also apply for an extension on the July 15 date, which will make your tax return date October 15, 2020.

It's essential to remember that the tax extension only applied to the date of filing your taxes. It doesn't give you any more time to pay: your taxes owed should still be paid by July 15, or you will incur penalties and charges.

WHEN ARE THE TAX DEADLINES FOR ESTIMATED QUARTERLY PAYMENTS IN 2020?

The IRS operates a quarterly estimated tax payment from people whose income isn't subject to payroll withholding taxes.

Businesses should calculate their income tax liability (Form 1120-W) for both the first quarter and the second quarter on July 15.

By July 15, 2020, businesses have to submit their corporate tax returns from any income received in 2019.

To do so, use Form 1120, or you can request a six-month extension by filing Form 7004 with a deposit for the estimated tax owed.

COVID-19 AND TAX CREDITS

The announcement of the Coronavirus Aid, Relief, and Economic Security (CARES) Act, and the Families First Coronavirus Response Act (FFCRA) were put in place specifically to help businesses with new credits and changes. The following 9 credits could apply to your business:

• Employee Retention Tax Credit
  • The Employee Retention Tax Credit (ERTC) is designed to help businesses keep on employees. To claim the ERTC, a Form 941 will report the total qualified wages and related healthcare costs on your tax return.
  • These credits can then be taken against your share of Social Security, but the excess is refundable.
• Tax Credit for Sick and Family Leave
  • The FFCRA specified that small businesses with less than 500 employees would be required to provide paid sick and paid family leave, specific to Coronavirus.
  • The CARES Act then provides a refundable credit equal to 100% of the amount spent on paid sick leave and family leave.
• Delayed Payroll Tax Payments
  • Payroll Tax Payments can be delayed, thanks to the CARES Act. Social Security Tax and Deposits that are owed for 2020 can now bve deferred and paid over the next two years, subject to a schedule.
  • 50% should be paid by the end of 2021, with the other half paid by the end of 2022.
  • It’s important to note that the ability to defer these taxes typically won’t apply to your business if you’re receiving a Paycheck Protection Program Loan.
• Charitable Gift Deduction Expansion
  • While it isn’t an automatic change, the CARES Act increased the charitable contributions made by a business can now be up to 25%.
• Net Operating Loss (NOL) Changes
  • If your business had an NOL from 2018-2020, some of the limitations have now been relaxed. This is specifically to help improve businesses’ cash flow and liquidity, but it’s essential to see which rules apply to you.
• Business Loss Deduction Changes
  • The CARES Act has suspended the loss limitation rule from 2018-2020.
  • In some cases, if you had losses limited in 2018 or 2019, you can file amended returns to receive refunds.
• Corporate AMT Credits
  • If you were due to receive any AMT Credits at the end of 2021, you might be able to claim a refund now to help boost you cash flow.
• Interest Deductibility Changes
  • Your business may be able to increase interest expense deductions from 30% to 50% for 2019 and 2020.
• Facility Improvement Write-Off
  • If you have made improvements on non-residential building from 2018 onwards, you may be able to write off costs up to 100% and could be applicable right away.

WHAT ABOUT STATE TAXES?

The July 15, 2020 extension only applies specifically to federal government taxes. When it comes to filing your state taxes, each individual state has its own requirements.

Some states have implemented their own extensions to ease the strain on businesses, although these vary. Check out the American Institutes of CPAs, who have compiled a list of the tax deadlines for each state here.

Currently, the states who don't have an income tax are Alaska, Florida, Nevada, South Dakota, Texas, Washington, and Wyoming.

DO YOU NEED HELP WITH YOUR 2019 TAXES?

With the change in dates and the shifting of credits, you might find yourself a little lost as to what applies to you. There are also other provisions related to things like federal excise taxes and alcohol.

To be absolutely confident you are filing correctly and efficiently, and getting all of the extra help that is being afforded to you during this time, contact Hall Accounting Company by sending us an email at tax@hallacctco.com to see how we can help.

JULY IMPORTANT DEADLINES

7/15/20
Individual and C-Corp Tax Return Due
IRS Deadline for Tax Returns Due (Form 1040 and 1120), must file extension if proceeding beyond this date

7/15/20
Deadline for SEP-IRA or Solo 401K Funding
Deadline for SEP-IRA or Solo 401K Funding for Tax Year 2019

7/15/20
Deadline for SIMPLE-IRA Establishment
Deadline for Self-Employed or Small Employers to Establish a SIMPLE-IRA

7/15/20
Estimated 1st Quarterly Tax Payment for 2020 Tax Year Due
IRS Deadline for Quarterly Estimated Payments for 2020 (Form 1040-ES)

7/15/20
Estimated 2nd Quarterly Tax Payment for 2020 Tax Year Due
IRS Deadline for Quarterly Estimated Payments for 2020 (Form 1040-ES)

OTHER FUTURE IMPORTANT DEADLINES

9/15/20
Partnership and S-Corp Tax Returns Due, if extended
IRS Deadline for Tax Returns Due (Form 1065 and 1120-S), must file extension if proceeding beyond this date

9/15/20
Estimated Quarterly Tax Payment for 2020 Tax Year Due
IRS Deadline for Quarterly Estimated Payments for 2020 (Form 1040-ES)

10/15/20
Individual and C-Corp Tax Return Due, if extended
Deadline for SEP-IRA or Solo 401K Funding for Tax Year 2018

10/15/20
Deadline for SEP-IRA or Solo 401K Funding, if extended
Deadline for SEP-IRA or Solo 401K Funding for Tax Year 2019, if extended

1/15/21
Estimated Quarterly Tax Payment for 2020 Tax Year Due
IRS Deadline for Quarterly Estimated Payments for 2020 (Form 1040-ES)