What You Need to Know About Tax Return Deadlines and Federal Stimulus Funds
At a time when people are typically scrambling to file their income taxes, you may instead be trying to make sense of what’s going on with tax deadlines and federal stimulus funds. We have dates and answers to some of your questions.
Personal Income Tax Deadlines
The federal government announced last month they were extending the deadline for filing 2019 income taxes, from April 15 to July 15, as people deal with the COVID-19 pandemic. But this doesn’t mean you can’t file your taxes online or through the mail right now.
More than 84 million people have filed their federal income tax returns already, according to the Internal Revenue Service. That’s more than half of the expected filings. Last year, the IRS received 155 million personal income tax returns.
No delays are anticipated in processing tax returns.
Arkansas’ governor has also shifted the state’s deadline for filing personal income tax returns to July 15. This extension includes 2019 returns of Subchapter S Corporations, fiduciaries and estates, partnerships and composite returns.
Corporation income taxes are still due April 15 as are estimated 2020 tax payments. For more information about deadlines, visit https://www.dfa.arkansas.gov/images/uploads/incomeTaxOffice/IncomeTaxExtension.pdf.
The Internal Revenue Service has released guidance at www.irs.gov/coronavirus.
Federal Stimulus Checks
What does your federal stimulus check have to do with your taxes? You will likely need to file a federal income tax return in order to receive any stimulus dollars from the federal government.
Information is changing fast for the the $2 trillion Coronavirus Aid, Relief and Economic Security Act (CARES). The new law includes a one-time payment for many people from $1,200 up to $3,400, depending on your income and family size. According to the IRS, eligible taxpayers who filed tax returns for either 2018 or 2019 will automatically receive payments sometime this month.
But to tell you how fast things change, on March 30, the IRS announced that people who don't typically file tax returns would have to file in order to receive the stimulus funds. This included Social Security recipients.
But by April 2, that directive changed and the IRS has updated their website to say that people who receive Social Security (or railroad retirees) will automatically receive stimulus funds and do NOT need to file an income tax return.
It appears that low-income residents who don't receive Social Security benefits and don't normally file tax returns will still need to submit a tax return.
For the most up-to-date information, visit https://www.irs.gov/newsroom/economic-impact-payments-what-you-need-to-know.
Even if you do not owe money or qualify to not file a tax return, the federal government is using the form and banking information to send payments. If you are unable to file a tax return right now or contact a tax professional for help with filing, the IRS has said these economic impact payments will be available throughout the rest of 2020.
Not everyone who is earning an income will qualify - young adults claimed as dependents on their parents' taxes will not qualify for their own stimulus checks. The CARES Act also defines a "qualifying child" as someone not yet 17, so families with 17-18 year olds will not be receiving additional benefits for their older teenagers.
Remember, the IRS will not reach out to you by email, text or social media to request personal or financial information. If you are worried about a possible tax scam, check out this IRS website How to know it’s really the IRS calling or knocking on your door.
Paper filing is still an option, but the IRS encourages people to complete their tax returns online. Here’s an IRS website link for information about how to file your taxes for free: https://www.irs.gov/filing/free-file-do-your-federal-taxes-for-free