American taxpayers unsure about how the coronavirus pandemic may affect their financial life have some tax-related relief to look forward to.
The U.S. government has pushed back some key dates related to tax filing and payments, and they affect other things like retirement accounts and even health savings accounts.
The New Tax Deadline 2020: What You Need to Know
Here are three big ways tax deadlines are being affected by the coronavirus pandemic so far:
1. Federal Deadline to File & Pay Extended
The federal government has changed the tax filing deadline from April 15 to July 15, which means people who owe the IRS will have three months of:
- No interest accruing
- No penalties being assessed
The federal tax payment deadline is also July 15, Treasury Secretary Steven Mnuchin said in a tweet. The move followed guidance from the IRS.
2. State Tax Deadlines May Adjust As Well
The change in the federal tax deadline has already spurred some states to extend their tax filing and payment deadlines, as well.
The best way to know how it affects your personal circumstances is to visit your state government’s website for specifics.
3. More Time to Contribute to Tax-Favored Accounts
Another big change is that you get more time to pay into some of your tax-deductible or pre-tax accounts, according to the IRS website. Those accounts include:
- Individual Retirement Account (IRA)
- Health Savings Account (HSA)
- Archer Medical Savings Account (MSA)
“Contributions can be made to your IRA, for a particular year, at any time during the year or by the due date for filing your return for that year,” the IRS says. “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 same goes for HSAs and MSAs, they say.
Learn more about 2020 tax contributions and their limits here.
Takeaway
Even with so many changes taking place quickly right now, money expert Clark Howard wants you to take charge of your financial situation.
“If you are owed a refund, don’t wait,” Clark says. “If you prepare your own taxes, go ahead and file your return. Get a refund as quickly as you can.”
The #1 thing you can do if you haven’t filed already is to take advantage of the IRS Free File program. Check out these free filing options to get started.
