On March 17, 2021, the Treasury Department and Internal Revenue Service (IRS) extended the individual income tax filing and payment deadline from April 15, 2021 to May 17, 2021. Individual taxpayers may also defer federal 2020 income tax payments that would otherwise be due on April 15, 2020 until the May 17th deadline. However, this relief does NOT apply to estimated tax payments due on April 15, 2021.
The IRS cautions that the extension applies to individual federal tax returns only, not state tax payments or deposits (or any other type of federal tax). However, Massachusetts taxpayers can expect similar relief as lawmakers announced on March 18th that they plan to extend the state’s tax filing deadline to align with the federal filing and payment deadline. Language allowing the extension will be included as part of the COVID-19 relief bill, which the Massachusetts House and Senate have reach agreement on and are expected to pass quickly.
In addition to extending the tax-filing deadline, the COVID-19 relief bill will also exempt small businesses organized as pass-through entities from being taxed on Paycheck Protection Program forgiven loan amounts received in 2020 and prevent increases in the unemployment insurance rates for employers.
We will keep you informed of any updates.