Taxpayers will have more time to contribute to an individual retirement account for 2019 and make payments on installment agreements and offers in compromise, the Internal Revenue Service announced.
In addition, the latest version of the stimulus bill Congress is working to pass would let people who are required to take minimum distributions each year from individual retirement accounts — 401(k), 403(b) and most 457 retirement savings plans — skip them for 2020. That includes people who are past the age when required distributions begin (72 starting this year, 70 ½ in previous years) and people with inherited retirement accounts.
In an FAQ published Tuesday, the IRS said, “Because the due date for filing federal income tax returns has been postponed to July 15, the deadline for making contributions to your IRA for 2019 is also extended to July 15, 2020.”
The FAQ also answered nuts-and-bolts questions for taxpayers who have already filed their 2019 tax return but haven’t paid their taxes due yet and would like to postpone a payment, including a scheduled payment.
It also clarified that while the deadline for the first quarter estimated income tax payment due April 15 has been extended until July 15, “the second quarter 2020 estimated income tax payments are still due on June 15, 2020.” You can find the FAQ at https://bit.ly/virustaxdeadlines.
On Wednesday, the IRS announced it is “providing relief on a variety of issues ranging from easing payment guidelines to postponing compliance actions.”
Taxpayers under an existing installment agreement may suspend payments due from April 1 to July 15. The IRS will not default any agreements during this period, but interest will accrue on unpaid balances.
Taxpayers also have the option of suspending payments on accepted offers in compromise until July 15, although interest will accrue.
For pending offers in compromise, the IRS will give taxpayers until July 15 to provide any requested information and won’t close a pending offer before that date without the taxpayer’s consent.
The IRS also announced that its field officers will suspend liens and levies, including any seizures of a personal residence, but its revenue officers “will continue to pursue high-income non-filers and perform other similar activities where warranted.”
For more information, see https://bit.ly/irscoronavirus.
Kathleen Pender is a San Francisco Chronicle columnist. Email: firstname.lastname@example.org Twitter: @kathpender