Momentum is building to extend the 2021 tax filing deadline from April 15 to July 15 given the strain that the COVID-19 pandemic has placed on the Internal Revenue Service (IRS). The IRS did not start processing tax returns until February 12 due to the extra time it needed for programming and testing its systems following the tax law changes made by the Consolidated Appropriations Act, 2021 (CAA 2021), P.L. 116-260, which was enacted December 27th. Last year’s tax season was extended by three months until July 15, 2020.
As of the date of this publication, the number of returns processed by the IRS was down 31 percent. In addition, approximately three out of every four taxpayers who attempt to contact the IRS cannot reach anyone by phone.
To further complicate things, once it is signed into law, the American Rescue Plan will change the tax laws applicable to unemployment benefits received in 2020 and reported on returns filed during this filing season. Taxpayers need more time to file accurate returns and get their questions answered by the IRS.
Political leaders and accounting groups are calling for the extension of the tax deadline. These include leaders of the House Ways and Means Committee, the National Conference of CPA Practitioners, the National Association of Tax Professionals, and the American Institute of CPAs.
Galleros Robinson will keep you up to date as these conversations continue.
The information presented here should not be construed as legal, tax, accounting, or valuation advice. No one should act on such information without appropriate professional advice and after a thorough examination of the particular situation.