The 2021 Tax Deadline Will Be Delayed

        Just like last year, the Tax Deadline for 2021 will be pushed back. This year it will now fall on Monday, May 17. There have been calls for this action for some time. The reasons the Internal Revenue Service (IRS) took this action are many, but here are a few.

          The Tax Season this year started two weeks later than normal. This was to accommodate law changes that were passed in December 2020 and make sure that IRS computers were updated. The newly enacted 2021 American Rescue Plan Act also makes some significant changes to existing tax law, including allowing a certain amount of unemployment benefits from 2020 to be untaxed. With this recent news, some may take additional time to file, but the IRS does not want anyone to file an amended Tax Return at this time. If you look at this time last year, there have been about 18% fewer Tax Returns filed. It’s clear that people needed more time. What can you do with this extra time?

          This time can certainly be used to gather all your necessary documents and complete your Tax Return. This time should also be used wisely. Don’t wait unnecessarily. There is a provision in the American Rescue Plan Act to make Economic Impact Payments (EIP) through September if a Taxpayer’s 2020 Return makes them newly eligible for this third round of stimulus. It also provides more time for tax planning by contributing to a tax-advantaged account.

          With this in mind, for those who pay their estimated taxes quarterly, or who will owe taxes to the IRS, the deadline to pay is still April 15. This filing deadline adjustment only applies to Federal taxes, however the Franchise Tax Board (FTB) of California is also changing their filing date back to May 17, but payments are still due April 15. This is a fast moving situation and we can expect more guidance to come in the near future. If you have not done so already, make an appointment and talk to your Qualified Tax Professional without delay.

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