March 21, 2021

By C. Robert Holcomb, E.A., Extension Educator, Agricultural Business Management, University of Minnesota Extension 

On March 17, 2021, The Treasury Department and Internal Revenue Service (IRS) announced that the federal income tax filing due date for individuals for the 2020 tax year will be automatically extended from April 15, 2021, to May 17, 2021.  IRS will provide additional guidance in the coming days.

Individual taxpayers do not need to file any forms or call the IRS to qualify for this automatic federal tax filing and payment relief. Individual taxpayers who need additional time to file beyond the May 17 deadline can request a filing extension until October 15 by filing Form 4868 through their tax professional, tax software or using the Free File link on IRS.gov. Filing Form 4868 gives taxpayers until October 15 to file their 2020 tax return but does not grant an extension of time to pay taxes due. Taxpayers should pay their federal income tax due by May 17, 2021, to avoid interest and penalties.

This relief does not apply to estimated tax payments that are due on April 15, 2021. These payments are still due on April 15. Taxes must be paid as taxpayers earn or receive income during the year, either through withholding or estimated tax payments. In general, estimated tax payments are made quarterly to the IRS by people whose income isn't subject to income tax withholding, including self-employment income, interest, dividends, alimony or rental income. Most taxpayers automatically have their taxes withheld from their paychecks and submitted to the IRS by their employer.

In following with the IRS, the Minnesota Department of Revenue has announced a grace period for taxpayers filing their annual Minnesota Individual Income Tax return for tax year 2020. Taxpayers now have until May 17, 2021, to file and make their payments without any penalty or interest. 

As with IRS, the Minnesota grace period does not include individual estimated tax payments.

SWMFBMA April Tax filers

We will continue to process your tax returns as normal with a goal of getting your returns done by April 15. We may need to let our tax software update after these changes but we remain on track to timely complete your returns. Please continue to get your tax documents to your tax preparer as soon as possible.

Sources:
Internal Revenue Service (www.irs.gov)
Minnesota Department of Revenue (https://www.revenue.state.mn.us/minnesota-department-revenue)