tax form

Tax day was deferred in the U.S. by three months this year. Filings and payments are due July 15. 

SOUTHERN INDIANA — Tax day, deferred three months due to COVID-19, has again approached. And while federal numbers show that many taxpayers took advantage of that period, one Southern Indiana preparer said numbers have evened out.

On March 21, the U.S. Treasury Department and Internal Revenue Service announced the traditional April 15 tax day would be moved to July 15 for all taxpayers to file or make a payment. This includes businesses, individuals, trusts and estates, corporate and non-corporate entities and those who pay self-employment. The decision came just a week after President Donald Trump invoked the Stafford Disaster Relief and Emergency Assistance Act of 1988.

As of April 17, the IRS reported a 15.5% decrease in total federal returns filed compared with the same week the previous year — 115,961,000 in 2020 to 137,233,000 as of April 19, 2019. There was an even larger drop in total returns processed, with 18.5% fewer being done as of two days after the traditional April tax day this year.

But as of July 2, the 142,375,000 returns filed were just 2% lower than last year, and total processed returns 9.5% lower than last year.

There had been $263.008 billion in refunds dispersed as of July 2, an 8.7% decrease since the same time in 2019. The average refund as of the start of July was $18 more than the previous year.

Marc McCormick, CPA at Rodefer Moss & Co. PLLC in New Albany, said the business saw a drop of about 15% to 20% in return filings that would normally be in by April, what he called a “sizable percentage.” But he feels that the group of clients that initially waited had filed by the new tax deadline Wednesday.

“I think we’re pretty much at normal July 15 [between] this year and last year, it was just the timing,” he said.

While some of it may have been procrastination or people using the extra allotted time to instead focus on other things, McCormick said a lot of it was likely people staying in for health and safety reason at the start of the pandemic.

Until the end of May, the tax office was closed to the public although open for business — a mail slot was available for drop-offs and many of the staff worked from home when possible.

“But I think a lot of people just didn’t feel comfortable getting out,” he said, adding that the firm has still been quite busy.

“Basically we had two April 15ths this year. It’s normally just a crazy time, so [the new date was] not quite as bad as the normal April 15th but it has been very busy.”

One challenge during the spring tax season was just trying to navigate the logistics of working during the pandemic while adhering to safety guidelines and mandates.

“It was a challenge trying to navigate around ‘OK, how do we get files to our employees that are not here, how do we get things back, how do you communicate with staff in the office, with clients?’” he said. “It was a lot of challenges but we were able to work through it.”

The new deadline meant taxpayers had more time to file and pay their tax burden without penalty, but McCormick said it may also mean doubled-up payments for some who waited.

For those who make quarterly estimated tax payments, the first two are now both due today, rather than on April and June 15. The third and fourth payments still are due on their regular dates of September and January 15.

McCormick said it’s hard to predict what next year’s numbers will look like, because it’s still not clear how the pandemic will ultimately affect the economy.

“That’s avery good question and we’ve had that discussion because no one really knows how the long-term effect of this virus — how it’s going to affect businesses,” he said.

“Will they be able to survive? How is it going to look?” He added that the best answer is coming up with a vaccine or other treatment for the virus sooner rather than later, “[or] the long-term effects could be challenging,” he said.

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