Many US taxpayers have reacted positively to the news as the IRS extends the personal tax deadline to May 17 2021 from the usual deadline of April 15. For the second year in a row the Internal Revenue Service has give Americans an extra amount of time to submit personal tax returns for the year 2020 as a result of the COVID-19 pandemic. The IRS originally noted the extended deadline only applies to the federal tax return. However, the State of California quickly followed the IRS’ decision and also extended the deadline to file California personal income tax returns to May 17 2021 as well.
Estimated tax payments are still due April 15, 2021.
The IRS did not provide as much extra time to file as it did last year when the deadline for filing 2019 taxes was pushed to July 15. However, this will give many US taxpayers some extra time to organize information, research additional potential tax deductions and understand changes implemented in the recently passed “American Rescue Plan.”
This new law makes $10,200 of unemployment compensation benefits received by taxpayers in 2020 tax free for filers with an income below $150,000.
It is important to note that many US taxpayers have questions and concerns as the IRS extends the personal tax deadline to May 17 2021. “What happens if we already filed our 2020 return?” Many US taxpayers have already filed their 2020 tax returns to ensure they qualified for the recent stimulus payment. They obviously did not realize they qualified for the additional tax deduction for unemployment benefits when they filed earlier this year.
The IRS reassures taxpayers they will be able to take advantage of the new deduction provided by the American Rescue Plan. However, the IRS also asks those who have already filed not to file amended returns until the agency can provide further guidance.
For those who have yet to file their 2020 personal income tax returns, the IRS recommends having Allen Barron file your returns electronically with direct deposit in order to receive the fastest possible refund. Do you have questions about recent changes as California and the IRS extends the personal tax deadline to May 17 2021?
If you have international investments, own your own business or real property, have offshore financial accounts or a file a complex tax return we invite you contact us or call today for a free consultation at 866-631-3470. Learn how the experienced tax, legal and accounting team at Allen Barron can protect your interests while providing additional protections which are unavailable through traditional tax preparation professionals and services.
