Postponed 2019 tax due date is coming up fast — July 15
Posted on July 7, 2020
In case you didn’t circle July 15th on your calendar, heads up that it’s now looming just ahead.
The CPAs at Teipen Selanders Poynter & Ayres want to remind all taxpayers that if they haven’t already filed 2019 tax returns, they are due to the IRS on Wednesday, July 15th or late penalties begin to accrue. Extensions can still be filed, but payments are still due by July 15. If you haven’t even thought about taxes since April, call us to get started ASAP. (We promise not to roll our eyes.)
July 15, 2020 is also the due date for estimated quarterly tax payments for tax year 2020. These were originally due April 15 and June 15, but were postponed until July 15, due to the COVID outbreak. This means that any individual or corporation that has a quarterly estimated tax payment due has until July 15 to make that payment without penalty.
How do you know if you need to pay quarterly?
You may need to pay quarterly if you are self-employed. That includes many taxpayers involved in the sharing or so-called ‘gig economy.’ These individuals often don’t have taxes withdrawn from their part time wages, so they pay quarterly installments of their estimated tax instead.
You might also pay quarterly taxes if you are an investor or a retiree. That’s because a substantial portion of your income is not subject to withholding such as interest, dividends, capital gains, alimony, and rental income.
Special rules apply to some groups of taxpayers, such as farmers, fishermen, casualty and disaster victims, those who recently became disabled, recent retirees, and those who receive income unevenly throughout the year. Ask your CPA if you fall into one of these categories and are not sure of your status.
According to Teipen CPAs, you can avoid an underpayment penalty by owing less than $1,000 at tax time or by paying most of your taxes during the year. Generally, that means taxpayers need to pay most of their taxes owed during the year as income is received in one of two ways:
- Withholding from pay, pension or certain government payments such as Social Security; and/or
- Making quarterly estimated tax payments during the year.
New to estimated taxes?
Form 1040-ES, Estimated Tax for Individuals, is the form to use on the IRS.gov website. It includes instructions to help taxpayers figure estimated taxes. You can also visit IRS.gov/payments to pay electronically.
An easier way is to ask your TSPA CPA for assistance in figuring out the process, including estimating payments, and scheduling those payments. We are here to help with everything from simple questions to figuring out very complicated specialty issues.