By LYNN LOFTON
In March the Internal Revenue Service extended the deadline for filing 2019 federal income tax returns from April 15 until July 15 applying to all individual returns, trusts, and corporations. This relief was automatic with taxpayers not needing to file any additional forms or calling the IRS to qualify.
With the new deadline in place, are individuals putting off filing? Donna Bruce, CPA and partner with the BKD firm in Jackson says they’re seeing a pretty mixed result on filing. “Some are taking advantage of the additional time to file,” she said. “However, many clients want to go ahead and take care of the filing even if they hold their payment until the due date of July 15.”
An active member of the Mississippi Society of CPAs, Bruce says many of their members have had clients who have experienced significant negative impact from Covid-19 as well as from the recent tornadoes in various parts of the state. “The extension has been a much needed benefit that allowed the CPAs to help the clients with other business needs that were more time sensitive.”
Bruce and other CPAs are offering tax planning advice at this time when some of their clients are experiencing a reduction of income and business. “There are a number of tax provisions that provide not only deferral but permanent tax savings,” she said. “I would suggest that everyone review their situation with their CPA to determine how the changes could benefit them. The CARES Act included a number of provisions that are retroactive such as net operating losses generated in 2018 – 2020 can now be carried back five years to recover previously paid tax.
“The IRS has also provided for an expedited filing method to be able to help taxpayers recover cash sooner than they otherwise would.”
She and other CPAs are helping small businesses apply for assistance. “My firm as well as many of our members have been very busy helping clients with the various stimulus benefits, particularly the SBA Paycheck Protection Program,” she said. “The guidelines are still being issued which has caused many people to have questions as to how to apply and particularly how to quantify what their forgiveness request will be. I think we would all say that helping a client with this process is very rewarding as it brings a real benefit to them when they need it most.”
Bruce adds that the MSCPA has been proactive during this time that has been extraordinary for everyone. “Looking back, I think the MSCPA did a good job in a number of ways to provide assistance to our members. In addition to communication and education, we were involved in a very proactive way. We spoke for the members in assisting to shape rules and regulations to benefit our members and their clients,” she said.
The IRS reminds individual taxpayers who can’t file by July 15 that everyone is eligible to request an extension by filing Form 4868 through their tax professional, tax software or using the Free File link on IRS.gov. Businesses who need additional time must file Form 7004.
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