The IRS released Notice 2020-23 on April 9, 2020, which postpones until July 15, 2020 the filing of many federal tax returns and the payment of taxes that had been due on or after April 1, 2020 and before July 15, 2020. Any tax return or payment due on or after April 1, 2020, and before July 15, 2020, is now automatically postponed to July 15, 2020. The postponements granted in Notice 2020-23 are automatic and do not require the filing of an extension request. However, if taxpayers need additional time, they can file the appropriate forms to receive standard regulatory extensions.
The due date for employee benefit plans required to make the Form 5500 filing due on or after April 1, 2020, and before July 15, 2020 is extended to July 15, 2020. Plan Administrators with original (un-extended) filing due dates falling within this announced 2 ½ month period who need additional time to file beyond the extended July 15th date may request extensions by filing Form 5558 by July 15, 2020. However, the extended due date will not be later than what it would have been absent this relief. Unfortunately, the IRS has not yet provided relief for calendar year employee benefit plans who file the Form 5500, which without extension, remains due on July 31, 2020. Those with plan years ending September 30, October 31, or November 30 now have until July 15, 2020, to file their annual reports for the preceding plan year.
Health Savings Accounts
Contributions to your Health Savings Account (HSA) for 2019 are now due by July 15, 2020.
The Notice 2020-23 deadline extension to July 15, 2020, generally impacts non-calendar year cafeteria plans. Plans that permit new benefit elections for an employee’s status change, as well as elections for newly-hired employees will see deadline extensions apply on an individual basis. Issues of potential significance include the following:
- Deadline to elect qualified benefits
- Deadline to forfeit unused FSA benefits
- Deadline to receive cash for unused vacation days
The deadlines extended are only for plans beginning within the April 1 to July 15 window. Therefore, they may have limited application for certain plans (for example, the extensions with regard to cafeteria plans are generally tied to rules relating to the beginning or end of the plan year, so they may not be relevant if the cafeteria plan year does not begin during the window).
The IRS relief only extends to federal tax payment and filing deadlines, and does not affect state or local deadlines. Individuals and businesses may need information from their federal returns in order to complete their state filings. Taxpayers should check with their state department of revenue or other state government authority to determine their filing and payment deadline.
The above is intended for informational purposes only. Diversified Group recommends contacting your attorney or tax advisor for detailed advice on this IRS notice. Additionally the above only reflects a portion of the filings impacted by the extension. For further details, please refer to the IRS Notice here.