United States

IRS provides additional relief for corporate filings and payments

Guidance postpones filing, payment date for additional forms/elections

TAX ALERT  | 

Notice 2020-23 amplifies previous filing and payment relief, and now provides that any payment or filing obligation for corporate entities that otherwise would be due on or after April 1, 2020 and before July 15, 2020, will be automatically postponed until July 15, 2020. This relief applies both to returns with an original due date falling between April 1 and July 15, as well as returns with an extended due date falling within that time period. 

Provisions in the notice affecting corporate filings and payment obligations are outlined below.

Section III.A: Specified filing and payment obligations

  1. The extended deadline applies to filings and payments for calendar year or fiscal year payments and filings due with the following forms:

a. Form 1120, U.S. Corporation Income Tax Return, 1120-C, U.S. Income Tax Return for Cooperative Associations, 1120-F, U.S. Income Tax Return of a Foreign Corporation, 1120-FSC, U.S. Income Tax Return of a Foreign Sales Corporation, 1120-H, U.S. Income Tax Return for Homeowners Associations, 1120-L, U.S. Life Insurance Company Income Tax Return, 1120-ND, Return for Nuclear Decommissioning Funds and Certain Related Persons, 1120-PC, U.S. Property and Casualty Insurance Company Income Tax Return, 1120-POL, U.S. Income Tax Return for Certain Political Organizations, 1120-REIT, U.S. Income Tax Return for Real Estate Investment Trusts, 1120-RIC, U.S. Income Tax Return for Regulated Investment Companies, 1120-S, U.S. Income Tax Return for an S Corporation, and 1120-SF, U.S. Income Tax Return for Settlement Funds (Under section 468B)

b. Estimated tax payments for corporations

Section III.B: Postponement of due dates and payments 

1. The Notice further offered relief for other payments and specified forms with an original or extended due date falling between April 1, 2020 and July 15, 2020 are due July 15, 2020. Most relevant are: 

a. Section 965(h) installment payments are postponed 

b. Includes the filing of any forms, schedules or attachments included in a return (e.g. Form 5471)

c. Applies to any elections that require filing on a timely filed return. 

2. April 1 through July 15, 2020 is disregarded in determining any interest, penalties and any additions to tax that would normally result due to failure to pay or file. 

3. The relief granted in this revenue procedure is automatic. If a taxpayer required to file any of these forms needs additional time to file, they may request an extension. This extension may not extend past the original statutory or regulatory extension date. Any additional extension to file does not extend the time to make payments due on July 15, 2020.

Section III.D: Postponement of due dates for certain government acts

1. The notice provides the IRS additional time to perform certain ‘Time-Sensitive IRS Actions’ described in Reg. sec. 301.7508A-1(c)(2). The notice explains that:

Due to the COVID-19 emergency, IRS employees, taxpayers and other persons may be unable to access documents, systems or other resources necessary to perform certain time-sensitive actions due to office closures or state and local government executive orders restricting activities. The lack of access to those documents, systems or resources will materially interfere with the IRS’s ability to timely administer the Code. As a result, IRS employees will require additional time to perform time-sensitive actions.

2. The notice postpones the time the IRS is required to perform these actions, stating “the 30-day period following the last date for the performance of Time-Sensitive IRS Actions will be disregarded in determining whether the performance of those actions is timely.” Further, the postponement is subject to review and potential further postponement.

3. Included in these acts is the allowing of a credit or refund of any tax. Applications for quick refunds filed under section 6411 (for example, forms 1139 and 1045) has a statutory 90-day review and refund period. However, Treasury made the postponement under the authority granted to it in a presidential emergency declaration under the Stafford Act. As a result, it is unclear to what extent this postponement will affect refunds related to net operating loss carrybacks and corporate AMT credit refunds. We anticipate more guidance to clarify this postponement. 

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