As you can imagine, we are receiving new information and changes to deadlines from day to day. Here's the latest:
Confirmed Deadline Change for NJ Tax Filing
We had previously shared that this was likely to happen, and happy to confirm that New Jersey’s income tax filing deadline and corporation business tax filing deadline would be extended from April 15 to July 15.
Stay tuned for further details and deadline updates as we hear more. It's important to understand that this is an unusually fluid situation. Look for these email updates for further information as it unfolds.
Social Security Recipients Will Automatically Receive Economic Impact Payments
It has been announced that Social Security beneficiaries who are not typically required to file tax returns will not need to file an abbreviated tax return to receive an Economic Impact Payment. Instead, payments will be automatically deposited into their bank accounts.
The IRS will use the information on the Form SSA-1099 and Form RRB-1099 to generate $1,200 Economic Impact Payments to Social Security recipients who did not file tax returns in 2018 or 2019. Recipients will receive these payments as a direct deposit or by paper check, just as they would normally receive their benefits.
New Jersey Business Coalition Calls for Small Business Relief
The New Jersey Society of CPAs and more than 40 major business and nonprofit associations came together to send a letter to Governor Murphy with recommendations for a COVID-19 Legislative and Administrative Relief Package.
These proposals would bring immediate assistance to many small business, nonprofits and independent contractors who need to protect their businesses, their employees and New Jersey’s economy on the whole.
IRS urges taxpayers to use electronic options
The IRS suggests that taxpayers and tax professionals to use electronic options to support social distancing and speed the processing of tax returns, refunds and payments.
To protect the public and employees, and in compliance with orders of local health authorities around the country, certain IRS services such as live assistance on telephones, processing paper tax returns and responding to correspondence are extremely limited or suspended until further notice.
All Taxpayer Assistance Centers remain temporarily closed, as are many volunteer tax preparation sites, until further notice. This will not affect the IRS’s ability to deliver Economic Impact Payments, which taxpayers will begin receiving next week.
Although the tax filing deadline has been extended to July 15, 2020, from April 15, the IRS continues to process electronic tax returns, issue direct deposit refunds and accept electronic payments.
CARES Act Tax Savings for Businesses and Individuals
The following CARES Act tax-saving benefits can assist individuals:
- The 10-percent penalty is waived for eligible individuals under age 59 ½ who take a “coronavirus-related distribution” of up to $100,000 from their eligible retirement plan in 2020.
- Taxpayers do not need to take required minimum distributions (RMDs) from their retirement plan. If one chooses to withdraw money from a retirement account this year, it will be included as taxable income.
- Distributions from a retirement account of up to $100,000 can be reported as income over three years and/or repaid.
- Charitable donations up to $300 can be taken as an “above-the-line” deduction for taxpayers who take the standard deduction.
- Student loan payments paid by an employer up to $5,250 can be excluded from one’s taxable income for calendar year 2020.
- If a taxpayer receives a stimulus check, it will not be included in their taxable income.