Extension to 7/15 - Notice 2020-18

[shERPA]

OK, so this came out just now.  It is silent as to 404(a)(6) and IRAs.  Do employers automatically get til 7/15 to make and deduct their 2019 plan contributions? I think it should work for sole props and C corps whose returns are due 4/15 but get this automatic extension to 7/15.  It specifically extends the due date of the returns and 404(a)(6) references the due date of the return. 

Do IRA deposits also get an extension to 7/15? 

Quote

The relief provided in this section III is available solely with respect to Federal income tax payments (including payments of tax on self-employment income) and Federal income tax returns due on April 15, 2020, in respect of an Affected Taxpayer’s 2019 taxable year, and Federal estimated income tax payments (including payments of tax on self-employment income) due on April 15, 2020, for an Affected Taxpayer’s 2020 taxable year.

 

[shERPA]

Anyone?  People are asking if they can delay their contributions til 7/15.  

[Peter Gulia]

For questions about whether an employer gets a 2019 deduction for a contribution made after April 15, 2020:

I.R.C. § 404(a)(6)  Time When Contributions Deemed Made — For purposes of paragraphs (1), (2), and (3), a taxpayer shall be deemed to have made a payment on the last day of the preceding taxable year if the payment is on account of such taxable year and is made not later than the time prescribed by law for filing the return for such taxable year (including extensions thereof).

[Larry Starr]

2 hours ago, shERPA said:

Anyone?  People are asking if they can delay their contributions til 7/15.  

I'm going to believe that once they get the current bill done, we will get some clarifications that will allow the 4/15 date to move as well for IRA deposits.  But, that and $1.50......

[Barbara]

and what about delaying DB required deposits beyond 9/15?

[Mike Preston]

1 hour ago, Barbara said:

and what about delaying DB required deposits beyond 9/15?

Never happened before, but we are in uncharted territory.

[shERPA]

16 hours ago, Mike Preston said:

Never happened before, but we are in uncharted territory.

Yeah, unless there is an actual bill that looks like it has some momentum, I'm not going to suggest to clients that a minimum funding extension is even a possibility.  

[Larry Starr]

54 minutes ago, shERPA said:

Yeah, unless there is an actual bill that looks like it has some momentum, I'm not going to suggest to clients that a minimum funding extension is even a possibility.  

Definitely the way to go until we have some official guidance otherwise.

[Bill Presson]

https://www.irs.gov/newsroom/filing-and-payment-deadlines-questions-and-answers

Updated FAQ on the Notice

[Larry Starr]

22 hours ago, Larry Starr said:

I'm going to believe that once they get the current bill done, we will get some clarifications that will allow the 4/15 date to move as well for IRA deposits.  But, that and $1.50......

IRS has now confirmed that the IRA deadline is also extended.

[Peter Gulia]

And the IRC § 404(a)(6) time for a deductible contribution:

 

A20.  Yes, because these employers are Affected Taxpayers under Notice 2020-18 for whom the due date for filing Federal income tax returns and making Federal income tax payments that would be due April 15, 2020, is now July 15, 2020, the end of the grace period for these employers is also July 15, 2020 under this relief.  So, for example, if an employer is a corporation with an April 15, 2020 due date for filing the Form 1120, then the grace period under section 404(a)(6) for the employer to make contributions to its workplace-based retirement plan that are treated as made on account of 2019 ends on July 15, 2020.