This year will be the third time that taxpayers are filing their taxes during the pandemic. In the past, we’ve seen the Treasury Department and IRS push back the traditional tax deadlines to July 15th in 2020 and to May 17th in 2021.
In a recent article by Market Watch, IRS Commissioner Charles Rettig states there is no intent to push back the deadline this year. Although this year prepares to be a potentially bumpy tax season, it appears there will be no extra time for tax preparers and taxpayers to pay their 2021 tax bills and file a return. Rettig says the IRS will see how the tax season goes to decide whether to push back the deadline. “We don’t make that decision lightly either to extend it or not extend it. We share the same concerns everybody else has. We listen to a lot of people and we make a decision that we believe is best for the country,” said Rettig.
Taxpayers can still file an extension that would allow them an October 15th deadline to file their 2021 return. To avoid delays, the IRS is highlighting the importance of filing taxes electronically and getting a direct deposit rather than a check. More than 169 million returns were filed last year so this year the IRS expects over 160 million individual tax returns. Therefore, it is important to file accurate returns because errors will cause a delay in refunding bank accounts.
With the IRS staff declining over the past couple of years, the IRS had to temporarily shut down its operations during the beginning of the pandemic. Then, the IRS had to push out three rounds of stimulus checks, deal with millions of phone calls and tax law changes, and ultimately accumulate a backlog of returns.
“If you think you are not going to be able to submit your tax information in time to your CPA, let them know in advance so they can plan on filing your extension. If you’re a business owner, ask us about the R&D tax credit or the employee retention credit as you may be eligible for these tax savings opportunities,” states Lori Lato Morales, Tax Partner in Charge.
Calvetti Ferguson works with mid-market companies, private equity firms, and high net worth individuals across the country on tax consulting and planning. If you have questions or need assistance with tax planning, Calvetti Ferguson can help. For additional information click here to contact us. We look forward to speaking with you soon.