On March 17th the Treasury and the IRS announced that the filing deadline for individual federal tax returns (1040s) would be extended from April 15th, 2021 to May 17th, 2021. This extension is for both your requirement to file your personal 1040 and for your requirement to timely pay the amount of tax owed on your 2020 1040.
Make sure to check with your state to confirm that they will use this extension as well
A typical extension, taken by filing Form 4868, is an extension of your time to file (to October 15th) but not an extension of your time to pay. If the payment for your return is not done until after April 15th, you will typically have both penalties and interest applied to that payment. In contrast, for your 2020 filing, there will be no interest or penalties on payments made after April 15th, so long as they are made prior to May 17th.
It is important to note that this extension ONLY applies to federal returns and does not apply to state returns. States are going to need to independently decide whether they would like to update their deadlines to accord with this federal extension. Typically, most states will follow the federal in extending the deadline. Some states have provisions that allow returns to be extended with your federal extension if you don’t owe anything to the state, but you should not rely on this language to secure an extension for your state return, as in some states this is tied to the ‘filing’ of a federal extension. If you are planning on utilizing this extra month to get your return filed, consider filing extensions either way, as this will prevent any state specific issues related to the filing of your returns. Most states have not yet announced whether they will follow the federal extension (i.e. as of this writing NY and CT have not indicated if they will follow the federal extension) but CA has already announced that they will also extend their deadline to May 17th.
Please note that this extension currently only applies to personal returns (Form 1040) and does not apply to any entity/business filings. This extension also doesn’t apply to 2021 estimated tax payments. If you file your quarterly estimated tax payments, be sure to file the 1st quarter payment on or before April 15th.
This extension also doesn’t apply to FBAR filings, but, as usual, your FBAR filing will be automatically extended to October 15th if you don’t file by April 15th.
While we’re talking deadlines, it is also worth mentioning that if you live in Louisiana, Oklahoma, or Texas, you have until June 15th, 2021 to file your federal return as a result of the February winter storm disaster relief.
It may seem a bit bizarre and/or arbitrary that this extension is through May 17th. This was caused by the fact that May 15th is a Saturday, and as is the case with tax filing deadlines, when the due date falls on a weekend or on a holiday, it is extended to the next business day. In this case, the would-be May 15th due date has been extended to May 17th.