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Reminder to tax-exempt organizations: 990s, other forms due July 15; e-file best way to file
WASHINGTON — The Internal Revenue Service today reminds tax-exempt organizations that certain forms they file with the IRS are due on July 15, 2020. For organizations that operate on a calendar-year basis, this includes the 2019 Form 990 they would have normally filed on May 15. The upcoming July 15 deadline applies to many forms that were originally due May 15, including:
• Form 990-series annual information returns (Forms 990, 990-EZ, 990-PF, 990-BL)
• Form 990-N, Electronic Notice (e-Postcard) for Tax-Exempt Organizations Not Required to File Form 990 or Form 990-EZ
• Forms 8871, Political Organization Notice of Section 527 Status
• Form 8872, Political Organization Report of Contributions and Expenditures
• Form 990-T, Exempt Organization Business Income Tax Return
• Form 1120-POL, Political Organization Filing Requirements
• Form 4720, Private Foundation Excise Tax Return
Tax-exempt organizations that need additional time to file beyond the July 15 deadline can request an automatic extension by filing Form 8868, Application for Extension of Time to File an Exempt Organization Return. An organization will be allowed a six-month extension beyond the original due date. For a calendar-year 2019 return, this means the extended deadline would be Nov. 15, 2020. In situations where tax is due, extending the time for filing a return does not extend the time for paying tax.
The IRS urges all organizations to take advantage of the speed and convenience of filing their returns electronically when possible.
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Have an installment agreement or payment plan? Payments should resume starting July 15
The IRS reminds taxpayers who received tax relief as part of the People First Initiative and didn’t make previously owed tax payments between March 25, 2020 and July 15, 2020 they will need to restart those payments to avoid penalties.
Here’s what people need to do to restart their IRS Installment Agreements, Offers in Compromise or Private Debt Collection program payments:
Installment Agreements
Taxpayers who suspended their installment agreement payments between April 1 and July 15, 2020, will need to resume their payments by their first due date after July 15. Under the People First Initiative, the IRS didn’t default agreements, but interest did accrue and the balance remained.
Taxpayers who had their bank suspend direct debit payments, should contact the bank immediately to ensure their first monthly payment on or after July 15, 2020 is sent to avoid penalties. If someone can’t meet their current installment agreement terms because of a COVID-related hardship, they can revise the agreement or call the number on their IRS notice if they have a Direct Debit Installment Agreement.
Offer in Compromise
• Pending offers – If the IRS is currently reviewing a taxpayer’s Offer in Compromise but hasn’t accepted it, the taxpayer should restart their required payments on July 15, 2020. The IRS will amend the taxpayer’s offer to allow them to pay any skipped payments at the end of the offer period, if the offer is accepted.
• Accepted offers – If a taxpayer has an Offer in Compromise, and they were unable to make the payments because of a COVID-19 hardship, they should restart payments and make up the missed payments by July 15, 2020. If the taxpayer can’t to make up the missed payments, they should call the number on the IRS notice to discuss their situation.
Private Debt Collection
The IRS didn’t forward new delinquent accounts to private debt collection agencies from April 1 to July 15, 2020 and collection agency interaction with taxpayers was limited to phone calls, unless otherwise requested by the taxpayer.
Taxpayers should restart private debt collection payments by July 15. They should also work with their assigned collection agency to establish a new payment arrangement or restructure their existing one based on their current situation.
Other payment options
Taxpayers who owe but can’t pay, or have questions about their payments, can call the number on their notice but they may experience a long wait time on the phone. IRS.gov offers several convenient ways to make one time or recurring electronic tax payments.
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IRS advice for those who missed the July 15 deadline, file now to avoid bigger bill
WASHINGTON — For those who missed the July 15 tax deadline and didn’t request an extension, the Internal Revenue Service reminds taxpayers about some important tips, including filing electronically as soon as possible to reduce potential penalties.
Some taxpayers may have extra time to file and pay any taxes due without penalties and interest. These include:
• Members of the military who served or are currently in a combat zone. They qualify for an additional extension of at least 180 days to file and pay taxes.
• Support personnel in combat zones or a contingency operation in support of the Armed Forces. They may also qualify for a filing and payment extension of at least 180 days.
• Some disaster victims. Those who qualify have more time to file and pay what they owe.
The IRS offers these after-tax-day tips:
File to get a tax refund
The only way to get a refund is to file a tax return. There is no penalty for filing after the deadline if a refund is due. Use electronic filing options including IRS Free File available on IRS.gov through Oct. 15 to prepare and file returns electronically.
The IRS reminds taxpayers that, while we continue to process electronic and paper tax returns, issue refunds, and accept payments, we’re experiencing delays in processing paper tax returns due to limited staffing. If a taxpayer filed a paper tax return, we will process it in the order we received it. Do not file a second tax return or call the IRS.
Taxpayers can track a refund using the “Where’s My Refund?” tool on IRS.gov, IRS2Go and by phone at 800-829-1954. Taxpayers need the primary Social Security number on the tax return, the filing status and the expected refund amount. The tool updates once daily, usually overnight, so checking more frequently will not yield different results. The “Where’s My Refund?” tool cannot be used to track Economic Impact Payments.
File to reduce penalties and interest
Normally, taxpayers should file their tax return, or request an extension, and pay any taxes they owe by the deadline to avoid penalties and interest. Taxpayers need to remember that an extension to file is not an extension to pay. Penalties and interest will apply to taxes owed after July 15.
Even if a taxpayer can’t afford to immediately pay the taxes they owe, they should still file a tax return as soon as possible to reduce possible penalties. The IRS has more information for taxpayers who owe the IRS, but cannot afford to pay.
Ordinarily, the failure-to-file penalty is 5% of the tax owed for each month or part of a month that a tax return is late. But if a return is filed more than 60 days after the due date, the minimum penalty is either $435 or 100% of the unpaid tax, whichever is less. Filing and paying as much as possible is important because the late-filing penalty and late-payment penalty add up quickly. The basic failure-to-pay penalty rate is generally 0.5% of unpaid tax owed for each month or part of a month. For more see IRS.gov/penalties.
Taxpayers who have a history of filing and paying on time often qualify for penalty relief. A taxpayer will usually qualify if they have filed and paid timely for the past three years and meet other requirements. For more information, see the first-time penalty abatement page on IRS.gov.
Pay taxes due electronically
Those who owe taxes can view their balance, pay with IRS Direct Pay, by debit or credit card or apply online for a payment plan, including an installment agreement. Several other electronic payment options are available on IRS.gov/payments. They are secure and easy to use. Taxpayers paying electronically receive immediate confirmation when they submit their payment. With Direct Pay and the Electronic Federal Tax Payment System (EFTPS), taxpayers can opt in to receive email notifications about their payments.
Need help? Tips for selecting a tax professional
Taxpayers can also look for help from a tax professional. Taxpayers can use several options to help find a tax preparer. One resource is Choosing a Tax Professional, which includes a wealth of consumer guidance for selecting a tax professional. There are various types of tax return preparers, including enrolled agents, certified public accountants, attorneys and some who don’t have a professional credential.
The Directory of Federal Tax Return Preparers with Credentials and Select Qualifications is a free searchable and sortable database. It includes the name, city, state and zip code of credentialed return preparers who are CPAs, enrolled agents or attorneys, as well as those who have completed the requirements for the IRS Annual Filing Season Program. A search of the database can help taxpayers verify credentials and qualifications of tax professionals or locate a tax professional in their geographic area.
Taxpayer Bill of Rights
Taxpayers have fundamental rights under the law that protect taxpayers when they interact with the IRS. The Taxpayer Bill of Rights presents these rights in 10 categories. IRS Publication 1, Your Rights as a Taxpayer, highlights these rights and the agency’s obligation to protect them.
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What someone should do if they missed the July 15 deadline to file and pay
While the federal income tax-filing deadline has passed for most people, some taxpayers haven’t filed their 2019 tax returns yet.
If a taxpayer is entitled to a refund, there’s no penalty for filing late. Penalties and interest will begin to accrue on any remaining unpaid tax due as of July 16, 2020.
Anyone who didn’t file and owes tax should file a return as soon as they can and pay as much as possible to reduce penalties and interest. Electronic filing options, including IRS Free File, are still available on IRS.gov through Oct. 15, 2020 to prepare and file returns electronically.
Taxpayers should then review their payment options. The IRS has information for taxpayers who can’t pay taxes they owe.
Some taxpayers may have extra time to file their tax returns and pay any taxes due. This includes some disaster victims, military service members and eligible support personnel in combat zones.
Filing soon is very important because the late-filing penalty and late-payment penalty on unpaid taxes adds up quickly. However, in some cases, a taxpayer filing after the deadline may qualify for penalty relief. For those charged a penalty, they may contact the IRS by calling the number on their notice and explain why they couldn’t file and pay on time.
Additionally, taxpayers who have a history of filing and paying on time often qualify for administrative penalty relief. A taxpayer will usually qualify if they have filed and paid timely for the past three years and meet other requirements. For more information, see the first-time penalty abatement page on IRS.gov.
State filing and payment deadlines may be different from the federal July 15 deadline. A list of state tax division websites is available through the Federation of Tax Administrators.
The IRS is processing tax returns, issuing refunds and accepting payments. Taxpayers who mail or who have already mailed a tax return will experience a longer wait. There is no need to file a second tax return or call the IRS.
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