IRS Clarification on Tax Extension: Transition Tax, Information Returns, & More

The IRS has issued an FAQ to clarify rules regarding the extension of the tax deadline from April 15 to July 15.  The entire release can be seen by clicking here, but below is a summary of some key answers:

  • Everyone is eligible. You don’t have to show you were affected by the virus and there are no income limitations
  • Transition tax installment payments under Section 965 are extended as well, even though they are not for the 2019 tax year
  • Only the April 15 deadline is extended, returns due May 15 or June 15 are NOT extended
  • Does NOT apply to payroll taxes
  • Does NOT apply to estate tax returns and taxes
  • Does NOT apply to gift tax returns and taxes

There is still no guidance regarding informational forms such as Form 5471, 5472, etc.  On the one hand, the FAQ clearly states it does not apply to informational returns; however, these returns all have deadlines tied to the deadline of the main return and cannot be filed on their own.  Forms such as Form 3520 are more likely to fall into the category that is not covered.  We are reaching out to the IRS for more guidance, but in the meantime, it may be advisable to assume at least the Form 3520 has not been extended.

Disclaimer: Hone Maxwell LLP articles and blogs are not intended as legal advice. Additional facts, facts specific to your situation or future developments may affect subjects contained herein. Seek the advice of an attorney before acting or relying upon any information herein.

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