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Upcoming Tax Filing Deadlines – Are You and Your Clients Prepared?

The last 12 months have been anything but predictable. In just one short year, Congress passed three stimulus packages: the Coronavirus Aid, Relief, and Economic Security (CARES) Act, the Consolidated Appropriations Act (CAA), and the American Rescue Plan (ARP). Each of these bills had tax components, but a provision that none of these packages included was an extension of the tax filing deadline.

Fortunately, the IRS stepped in at the eleventh hour. In both 2020 and 2021, the IRS extended the tax return filing and payment deadlines, and most state and local jurisdictions followed suit. As that new filing deadline approaches, it’s important that you understand what’s coming due in 2021 and 2022. Are you and your clients prepared?

Individuals

Deadlines for 2020 Taxes

The U.S. Treasury Department and the IRS announced on March 17, 2021 that the Federal individual income tax filing deadline was extended from April 15, 2021 to May 17, 2021. IRS Commissioner Chuck Rettig said that the IRS wanted to do “everything possible to help taxpayers navigate the unusual circumstances related to the pandemic.”

With this announcement, the IRS also extended payments pertaining to the 2020 tax return. Final payments on 2020 tax returns are typically due on April 15, the same day the tax return is due. The IRS extended the payment deadline to May 17, 2021 to coincide with the filing deadline.

Other deadlines that have been extended to May 17, 2021 are:

These one-month extensions are automatic for all individual taxpayers.

Your clients will not incur late payment or additional underpayment penalties or interest if they wait to pay their taxes until May 17, regardless of how much is due. Interest and penalties will only begin to accrue if they make payments after May 17, 2021.

If your clients cannot file their return by May 17, they can request an extension using Form 4868. This will extend their filing deadline an additional five months, until October 15, 2021. This does not extend the deadline to pay taxes; your clients must still pay taxes associated with their 2020 returns on May 17, 2021.

At the time of this publication, almost all states have passed orders that mirror the IRS’s order, delaying their filing and payment deadlines until May 17, 2021. You can confirm new state deadlines by checking with each state’s Department of Taxation or Department of Revenue.

2020 Tax Deadlines – Individuals

Original Due DateExtended Due Date
2020 Federal Tax ReturnApril 15, 2021May 17, 2021
Payments Due on 2020 Federal Tax ReturnsApril 15, 2021May 17, 2021
2020 State Tax ReturnsMost states: April 15, 2021*Most states: May 17, 2021*
Payments due on 2020 State Tax ReturnsMost states: April 15, 2021*Most states: May 17, 2021*
* check with individual states to confirm conformance to new Federal deadlines

Deadlines for 2021 Taxes

At the time of this publication, no deadlines related to 2021 tax returns have changed.

Individuals who owe estimated taxes are required to pay them quarterly on April 15, June 15, and September 15 of the current year, and January 15 of the following year. On Thursday, April 8, 2021, Representative Lloyd Smucker from Pennsylvania announced that he would introduce a bill that would postpone the 2021 first quarterly estimated tax payment from its current deadline of April 15, 2021 to May 17, 2021. Most tax preparers calculate estimated taxes using the prior year’s tax return, so requiring an estimated payment before the prior year’s return has been filed may cause some confusion.

Even though the IRS has made it clear that first-quarter estimates are due April 15, it’s possible the first quarterly estimated tax payment would be extended. This is the approach the IRS used last year. 2019 tax returns, payments on 2019 tax returns, and 2020 first quarterly estimated tax payments were all postponed until July 15, 2020. But as of right now, first quarterly estimated tax payments for 2021 are due on April 15, 2021.

2021 Tax Deadlines – Individuals

Due Date
2021 1Q Estimated Tax PaymentApril 15, 2021
2021 2Q Estimated Tax PaymentJune 15, 2021
2021 3Q Estimated Tax PaymentSeptember 15, 2021
2021 4Q Estimated Tax PaymentJanuary 18, 2022
2021 Federal Tax ReturnApril 15, 2022
Payments Due on 2021 Federal Tax ReturnsApril 15, 2022

C Corporations

Tax return payment and filing deadlines for C corporations have not changed. Forms 1120 and associated payments (for calendar-year entities) are due April 15, 2021. Similarly, corporate estimated tax payments have not changed. They are due April 15, June 15, and September 15 of 2021, and January 15 of 2022.

2020 & 2021 Tax Deadlines – C Corporations

Due Date
2020 Federal Tax ReturnApril 15, 2021
Payments Due on 2020 Federal Tax ReturnsApril 15, 2021
2021 1Q Estimated Tax PaymentApril 15, 2021
2021 2Q Estimated Tax PaymentJune 15, 2021
2021 3Q Estimated Tax PaymentSeptember 15, 2021
2021 4Q Estimated Tax PaymentJanuary 18, 2022
2021 Federal Tax ReturnApril 15, 2022
Payments Due on 2021 Federal Tax ReturnsApril 15, 2022

S Corporations and Partnerships

S corporations and partnerships should have already filed their tax returns. Forms 1120-S and Forms 1065 were due on March 15, 2021. If you requested an extension for these returns, your clients must be ready to file by September 15, 2021.

S corporations and partnerships do not pay Federal estimated taxes on behalf of their owners, but some states allow (or require) flow-through entities to withhold taxes and make payments on behalf of their owners. New Jersey, for example, just this year implemented an optional entity-level tax called the Pass-Through Business Alternative Income Tax (BAIT). Pass-through entities that elect the NJ BAIT will file an entity-level tax return on behalf of their members and must pay quarterly estimated taxes on each member’s share of distributive proceeds.

Many other states, like Idaho, New York, and New Mexico, require partnerships to withhold and pay taxes on non-residents’ share of state-sourced income. Make sure you do some research about required state withholdings if your clients are owners of pass-through businesses operating in more than one state or that have nonresident owners.

2020 & 2021 Tax Deadlines – Pass-Through Entities

Due Date
2020 Federal Tax ReturnMarch 15, 2021
2021 Federal Tax ReturnMarch 15, 2022

Tax Software May Help

These deadline extensions often happen just before the filing deadline, so you cannot rely solely on your tax preparation software to inform you of the changes. But it’s important you pay close attention to any and all deadline changes because they can be lifesavers for your clients who are struggling with cash flow.

Once you’ve filed your clients’ 2020 tax returns, get a jump on the year ahead by bringing them in for a tax planning session. Tax planning during the summer months is the best time for you to explore new opportunities for your clients and their business. If you want to sell them on a new tax strategy, invest in a good tax planning software. Corvee tax planning software suggests changes you can make to your clients’ tax position and will show exactly how much money it will save them.

If You’d Like To See a Demo of How Our Software Works, Reach Out to Us Today.

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