IRS Postpones Due Date for Filing and Payment of Federal Estate (and Generation-Skipping Transfer) Taxes, Expands Extension of Other Filing Deadlines

The Internal Revenue Service (IRS) has announced that the due date for certain taxpayers filing Form 706, United States Estate (and Generation-Skipping Transfer) Tax Return, and/or making payments of federal estate and generation skipping transfer tax is automatically extended until July 15, 2020.  Ordinarily such filings and payments are due nine months after the date of death of a decedent.  If the due date for filing the estate tax return and/or paying estate tax falls on or after April 1, 2020 and before July 15, 2020 (the “postponement period”), Notice 2020-23 automatically extends the due date for filing and/or payment until July 15, 2020.  No interest or penalties will be imposed during the postponement period. 

If the original due date that is nine months after the decedent’s date of death falls during the postponement period, a taxpayer may file Form 4768 by July 15, 2020 in order to obtain an extension of time to file Form 706 to the date that is six months after the original nine month due date.  However, the payment of federal estate and generation-skipping tax will still be due by July 15, 2020.

Notice 2020-23 also broadly expands the relief provided in prior IRS Notices by extending the due date to July 15, 2020 for most filings, payments, and time-sensitive tax elections and actions that otherwise would be due during the postponement period.  This includes relief of the following:

• quarterly estimated income tax payments for individuals, trusts, estates, corporations and tax-exempt organizations;
• gift and generation-skipping transfer tax payments and return filings on Form 709 that are due on the date an estate is required to file Form 706 or 706-NA;
• filing Form 8971 and any supplemental Form 8971, Information Regarding Beneficiaries Acquiring Property from a Decedent;
• estate tax payments of principal or interest due as a result of certain elections, extensions or installment plans, and recertification of such plans (e.g. under Internal Revenue Code (IRC) sections 6166, 6161 or 6163);
• excise tax payments on investment income and return filings on Form 990-PF, Return of Private Foundation, or 4720, Return of Certain Excise Taxes Under Chapters 41 and 42 of the Internal Revenue Code, or pursuant to IRC section 4947(a)(1);
• making contributions to a qualified retirement plan or recharacterizing such contributions; and
• filing a petition with the Tax Court or a petition for review of a decision of the Tax Court or filing a claim for credit or refund or bringing suit on a claim for credit or refund of any tax.

Extension of these additional filings beyond July 15, 2020 does not extend the due date for any resulting payment due beyond July 15, 2020. 

Notice 2020-23 also extends the due date for certain federal government actions during the postponement period, including the due date for: assessing taxes, giving or making any notice or demand for payment of any tax, collecting tax, bringing suit, and allowing a refund or credit of any tax. 

The IRS previously announced that the due date for filing federal income tax returns and making federal income tax payments for the 2019 taxable year for individuals, trusts, estates, partnerships, associations, companies, and corporations was extended from April 15, 2020 to July 15, 2020.  The IRS also previously announced that the due date for filing Form 709, United States Gift (and Generation-Skipping Transfer) Tax Return, and paying federal gift and generation-skipping transfer tax for the 2019 taxable year is automatically postponed from April 15, 2020 to July 15, 2020.

If you have questions about your tax filing and payment deadlines, or the scope of this expanded relief, please contact your Vorys attorney.