Good news for those of us still feeling the effects of the global pandemic and the economic slowdown that came with it: as it did last year, the IRS has extended the deadline for filing federal individual income taxes. While the United States has been making great strides in tackling Covid-19 over the past few months, the Treasury Department notes, “This continues to be a tough time for many people, and the IRS wants to continue to do everything possible to help taxpayers navigate the unusual circumstances.” The extension isn't quite as long as last year, when the IRS moved the deadline back a full three months to July 15. Even so, May 17 will give filers an entire extra month to get organized.
While the federal government's decision doesn't apply to state filing deadlines, many states, including Maryland, have chosen to follow the federal government's lead and extend their own deadlines. In fact, Maryland has gone even further, extending its deadline to July 15.
Of course, the extension shouldn't become an excuse to put off doing your taxes until the very last minute. But for those of us still working from home and trying at the same time to keep an eye on what our kids are up to in the next room, the new date does offer some welcome extra breathing room.
The Fine Print
Taxpayers don't need to file any additional paperwork to take advantage of the extension. Also, the government won't be charging interest or penalties on unpaid balances over the course of this extra month. In short, the extension is just what it says it is: an extra month to file taxes.
Notably, however, the extension does not apply across the board to all IRS due dates. Freelancers, for instance, who pay quarterly estimated taxes on their income, must still make those payments by the normal April 15 deadline. This is a significant shift from 2020, when the IRS pushed this date to July 15 as well.
Finally, the IRS encourages taxpayers to go ahead and file as soon as possible. Too many last-minute filers create bottlenecks in the system every year. Early filing will help those expecting refunds to get them sooner. And after all, who doesn't want their money sooner rather than later?
Avoid the Rush, File Now
Bottom line, you have any extra month to file this year. Don't waste it, though. The fact of the matter is, too many people put off filing their taxes each year until the very last minute. That will always be true, whether the deadline is April 15, May 17, or December 31. Don't get caught waiting in line to talk to a tax professional or worse, waiting in line to receive a refund. Use this year's extension to get ahead on your taxes.
To find out more about the IRS's extended deadline, or any other 2021 tax code changes, contact the tax attorneys at Gabaie & Associates, LLC at 443-345-8291.