| Tax filing this year has become a bit more complicated.
To start, the tax-filing deadline was indeed delayed. However, it's important to check the fine print, because you may still need to pay by April 15.
The deadline to file a 2020 individual federal return and pay any tax owed has been extended to May 17, about a month later than the typical April deadline. The Treasury Department and the IRS moved the date to give filers, tax preparers and the IRS itself more time to adjust to disruptions from the coronavirus pandemic.
Most states are following the extended federal deadlines, and a few have adopted even more generous extensions.
However, the IRS has NOT postponed the deadline for making estimated tax payments for this year's first quarter, as it did last year when it delayed Tax Day because of the pandemic.
So, as CNBC reporter Carmen Reinicke points out: Those who make estimated tax payments are still on the hook for their first quarterly payment, which is due on the original tax-filing deadline of April 15.
That includes people who have income that is not subject to withholding, such as earnings from self-employment, interest, dividends, rent and alimony, according to the IRS. This mostly affects freelance and gig workers, as well as those with small businesses, such as sole proprietors, partners and S-corporation shareholders — generally, anyone who doesn't work for an employer that withholds taxes from their paycheck.
For more key stuff like this, please follow me on Twitter @jimpavia and check out CNBC's Financial Advisor Hub and CNBC + Acorns Invest in You: Ready. Set. Grow. |
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