4 Things To Know About Preparing Your Taxes During The COVID-19 Crisis

Posted on: 24 March 2020

Right now, the United States is experiencing a national emergency that has impacted the tax process. It is important to stay on top of tax changes as they impact you. Here are a few things you need to know about filing your 2019 taxes during the COVID-19 crisis.

Thing #1: Tax Filing Deadline Has Been Extended

The normal tax deadline of April 15th has been extended all the way to July 15th. With so many people being asked to practice physical distancing and to stay home, it is more difficult for all the last-minute tax filers to access tax resources. The extension of the tax deadline is designed to allow everyone to be able to access the tax help they need to file their taxes.

Thing #2: Tax Payment Deadline Has Been Extended

Not only has the file taxes been extended, but so has the deadline to pay your taxes if you owe money to the government. Many businesses and independent contractors, who do not automatically have money removed from their paychecks to pay taxes, may find themselves in a position where they own on their taxes.

If you owe taxes to the federal government, you have until July 15th, instead of April 15th, to pay your taxes without incurring any penalties or additional fees. This is a deviation from the regular process, where you face interest and fees each month your tax payment is late.

Thing #3: File Now If You Qualify for a Refund

Next, if you are owed a refund, there is no reason to wait three extra months to get your money. The federal government is still honoring tax payment refunds.

So if the federal government owes you money, get your taxes done as soon as possible so you can use that money to help you get through the current economic crisis.

Thing #4: Make Your IRA Contribution

Although the tax payment deadline has been extended, the deadline for making your yearly contribution to your IRA account has not been extended. If you want to reduce the taxes you owe to the government, you can still contribute money to your IRA and have that many subtracted from your overall income, reducing your tax burden.

This can be a great way to pay yourself instead of paying the government. If you owe taxes to the government but have not maxed out your IRA, be sure to do that by April 15th even if you plan on taking advantage of the extended filing deadline.

The current COVID-19 crises have impacted the tax filing process. If you are getting a refund, file as soon as possible so you can gain access to that money. If you have not made your 2019 IRA contributions, you still need to do so by April 15th. If you owe taxes or are still getting your paperwork together, you have until July 15th to finalize things this year.

To learn more about tax preparation, contact tax accountants in your area.