On March 18, 2020, the Internal Revenue Service issued a notice stating that corporations can defer up to $10 million and individuals can defer up to $1 million in tax payments for 90 days. During that three-month deferral period, taxpayers will not be subject to interest, penalties, and additions to tax. Importantly, the Notice does not extend the date to file tax returns or extensions. Filing of federal tax returns can be placed on extension, but taxpayers should still file the extension to file.
Likewise, the California Franchise Tax Board (“FTB”), on March 13, 2020 provided that corporate and individual taxpayers have until June 15, 2020 to file 2019 income tax returns for those taxpayers affected by the COVID-19 pandemic. The FTB may extend the due dates even further if the Internal Revenue Service grants a longer relief period.
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