Tax relief provided by state and local tax and revenue departments in response to the novel coronavirus (COVID-19) is discussed below.
Alabama. The Alabama Department of Revenue has announced that, effective immediately, it is extending relief to small retail businesses that are unable to timely pay their February, March, and April sales tax liabilities. Specifically, small businesses whose monthly retail sales during the previous calendar year averaged $62,500 or less may file their monthly sales tax returns for the February, March, and April 2020 reporting periods without paying the state sales tax reported as due. Late payment penalties will be waived for these taxpayers through June 1, 2020. Similar sales tax relief may be available on a case-by-case basis to other businesses significantly impacted by COVID-19 and the preventative measures being taken to limit its spread in Alabama. Taxpayers seeking additional information are advised to visit the Department website’s “COVID-19 Updates” page or call the Sales and Use Tax Division at (334)-242-1490. (Notice, Ala. Dept. of Rev., 03/18/2020; Ala. Commr. Order, Ala. Dept. of Rev., 03/18/2020.)
The Department has announced that the March 2020 motor vehicle registration and vehicle property tax payment deadlines have been extended through April 15, 2020 for registrants across the state unable to register or renew their motor vehicle registrations or pay property taxes on their motor vehicle because of the state of emergency resulting from the potential spread of COVID-19. The extension includes the registration of vehicles purchased where the 20-day registration requirements falls during the period of March 17, 2020 through April 15, 2020. Penalty charges associated with motor vehicle property tax payments and motor vehicle registrations and renewals extended through April 15, 2020 will not be charged until April 16, 2020. The extension also applies to motor vehicle registrations and renewals for vehicles registered pursuant to the International Registration Plan (IRP). (Order of the Commr. of Rev., Ala. Dept. Rev., 03/16/2020.)
Because there is a state of emergency resulting from the potential spread of COVID-19, the Commissioner of the Department has announced that the Department will temporarily suspend the requirements associated with the IRP and the International Fuel Tax Agreement (IFTA) for any motor vehicle engaged in interstate emergency relief efforts which will be traveling through the State of Alabama as part of the emergency relief. The temporary suspension is effective for 30 days from the date of the commissioner’s order, i.e., until April 15, 2020. (Order of the Commissioner, Ala. Dept. of Rev., 03/16/2020.)
Effective immediately, the Department has announced that it is extending relief to businesses unable to timely pay their February, March, and April 2020 state sales tax liabilities who are currently registered with the Department as engaging in NAICS Sector 72 -Accommodation and Food Services (NAICS Sector 72) business activities. Businesses included in NAICS Sector 72 are those preparing meals, snacks, and beverages for immediate consumption. NAICS Sector 72 taxpayers filing returns for these reporting periods will receive waivers through June 1, 2020, of late payment penalties for state sales tax liabilities reported on their returns. Similar sales tax relief may be available on a case-by-case basis to other businesses significantly impacted by COVID-19 and the preventative measures being taken to limit its spread in Alabama. (Release, Ala. Dept. of Rev., 03/19/2020; Order of the Commr. of Rev., Ala. Dept. of Rev., 03/19/2020.)
Effective immediately, the Department has announced that it will extend relief to state lodgings tax account holders who are unable to timely pay their February, March, and April 2020 state transient occupancy tax, i.e., lodgings tax, liabilities. Late payment penalties for state lodgings tax liabilities reported for these tax periods will be waived through June 1, 2020. The Department cautions taxpayers that the relief applies only to waive late payment penalties for state lodgings tax liabilities. The Department has not extended the return filing deadlines for state lodgings taxes. State lodging tax filers should timely file all lodgings tax returns as normal and report any taxes due. Similar state sales tax relief may be available on a case-by-case basis to other businesses significantly impacted by COVID-19 and the preventative measures being taken to limit its spread in Alabama. (Release, Ala. Dept. of Rev., 03/20/2020.)
California. The California Employment Development Department (EDD) has announced that employers statewide directly affected by COVID-19 may request up to a 60-day extension of time from the EDD to file their state payroll reports and/or deposit payroll taxes without penalty or interest. A written request for an extension must be received within 60 days from the original delinquent date of the payment or return. (Emergency and Disaster Assistance for Employers, Statewide – March 2020, California Employment Development Department, 03/01/2020.)
Governor Gavin Newsom issued on March 12, 2020, an executive order regarding California’s response to the COVID-19 pandemic. The executive order, which is effective immediately, orders, among other things, that: (1) to quickly provide relief from penalties and interest, the provisions of the Revenue and Taxation Code that apply to the taxes and fees administered by the California Department of Tax and Fee Administration (CDTFA), requiring the filing of a statement under penalty of perjury setting forth the facts for a claim for relief, are suspended for a period of 60 days after the date of the order for any individuals or businesses who are unable to file a timely return or make a timely payment as a result of complying with state or local public health officials imposition or recommendation of social distancing measures related to COVID-19; and (2) the Franchise Tax Board (FTB), the State Board of Equalization (SBE), the CDTFA, and the Office of Tax Appeals (OTA) shall use their administrative powers where appropriate to provide those individuals and businesses impacted by complying with a state or local public health official’s imposition or recommendation of social distancing measures related to COVID-19 with the extensions for filing, payment, audits, billing, notices, assessments, claims for refund, and relief from subsequent penalties and interest. (Executive Order N-25-20, Executive Department, State of California, 03/12/2020.)
During the 60-day window specified in Governor Newsom’s executive order on the COVID-19 pandemic (see previous paragraph), the CDTFA has posted on its website an alert in which it advises that it has been able to make it easier for such taxpayers and feepayers to request relief from the imposition of interest and penalties. They can go through the CDTFA’s normal online process for requesting relief, they can send a letter (a link to the CDTFA’s office locations and addresses is provided), or they can call the CDTFA’s call center at 1 (800) 400-7115. (Alert, California Department of Tax and Fee Administration, 03/12/2020.)
The CDTFA has done the following: (1) created a COVID-19 state of emergency webpage; and (2) added COVID-19 to the list of disasters for which state of emergency tax or fee relief is available. Regarding (1), on March 12, 2020, Governor Newsom issued an Executive Order in response to the COVID-19 State of Emergency. Pursuant to this Executive Order, through May 11, 2020, the CDTFA has the authority to assist individuals and businesses impacted by complying with a state or local public health official’s imposition or recommendation of social distancing measures related to COVID-19. This assistance includes granting extensions for filing returns and making payments, relief from interest and penalties, and filing a claim for refund. Taxpayers may request assistance by contacting the CDTFA through its online services, by sending a letter, by email, or by phone. Regarding (2), the CDTFA’s emergency tax or fee relief is available for business owners and feepayers directly affected by disasters declared as state of emergencies over the past three years, may include extension of tax return due dates, relief of penalty and interest, or replacement copies of records lost due to disasters. An extension of up to three months to file and pay taxes is available in 32 of the programs administered by the CDTFA (including sales and use tax, various fuel taxes, and cigarette and tobacco products taxes) for taxpayers directly affected by COVID-19 who, as a result, cannot meet their filing and payment deadlines. Affected taxpayers may apply online for relief from penalties and interest and request online a filing extension. Business owners and fee payers who need to obtain copies of CDTFA tax records will be able to receive replacements free of charge. (COVID-19 State of Emergency Webpage, California Department of Tax and Fee Administration, 03/13/2020; State of Emergency Tax Relief Webpage, California Department of Tax and Fee Administration, 03/13/2020.)
In response to COVID-19, San Francisco Mayor London Breed has announced various measures to support small businesses, including a deferral of business taxes. In order to provide immediate cash-flow assistance to small businesses, the mayor will be working with Treasurer Jose Cisneros to notify them that the next round of quarterly businesses taxes can be deferred. Businesses are required to pre-pay their first quarter business taxes for the current tax year by April 30, 2020. This announcement will allow businesses to not pre-pay, deferring payment due to February 2021. No interest payments, fees, or fines will accrue as a result of the deferral. This benefit will be offered to business with up to $10 million in gross receipts. (News Release, Office of the San Francisco Mayor, 03/11/2020.)
The FTB has announced updated tax relief for all California taxpayers due to COVID-19. With the updated relief, the FTB is postponing until July 15, 2020, the filing and payment deadlines for all individuals and business entities for the following: (1) 2019 tax returns; (2) 2019 tax return payments; (3) 2020 first and second quarter estimate payments; (4) 2020 LLC taxes and fees; and (5) 2020 non-wage withholding payments. To give taxpayers a deadline consistent with that of the Internal Revenue Service (IRS) without the federal dollar limitations, the FTB is following the federal relief described in Notice 2020-17. The FTB is providing its updated relief to all California taxpayers, not just to those affected by COVID-19. Taxpayers do not need to claim any special treatment or call the FTB to qualify for this relief. The updated relief supersedes the COVID-19 relief the FTB announced last week pursuant to which it extended until June 15, 2020, the due dates for filing and paying California taxes for taxpayers affected by COVID-19, with the qualification that those deadlines may be extended further if the IRS grants a longer relief period, which it has done. Also, in connection with the updated relief, the FTB has posted on its website a spreadsheet, COVID-19 – Extensions to file and pay – 2019 Taxable year, that shows: (a) for calendar year filers and certain fiscal year filers, the COVID-19 due date to file and pay, the original due date, and the extension due date for various return types, e.g., personal, partnership, LLC taxed as a partnership, LLC taxed as a corporation, estates and trusts, C corporations, S corporations, and exempt organizations; and (b) the 2020 estimated tax payment due dates for the following return types: personal, C corporations, S corporations, and exempt organizations. (California FTB News Release No. 03/18/2020, 03/18/2020; COVID-19 – Extensions to file and pay, 2019 taxable year, California Franchise Tax Board, 03/18/2020.)
Connecticut. The Connecticut Department of Revenue Services (DRS) is granting automatic extensions of Connecticut filing deadlines for certain annual tax returns due on or after March 15, 2020 in order to support businesses during the COVID-19 outbreak effective immediately. The extensions impact the corporation business tax return, the pass-through entity tax return and the unrelated business income tax return. Individuals in the process of preparing their Connecticut income tax returns (Form CT-1040) due April 15, 2020 are advised that DRS will adjust due dates for filing and payment of state income taxes to align with any specific, actionable announcement from the Internal Revenue Service regarding due dates for the filing and payment of federal income taxes. Effective immediately, the filing deadlines for various annual tax returns due on or after March 15, 2020, and before June 1, 2020, are extended by at least 30 days. In addition, the payments associated with these returns are also extended to the corresponding due date in June. The filing date for the 2019 Forms CT-1120 and CT-1120CU Connecticut corporation business tax return is extended to June 15, 2020 and the payment deadline is extended to June 15, 2020. The filing date for the 2019 Form CT-1065/CT-1120 SI Connecticut pass-through entity tax return is extended to April 15, 2020 and the payment deadline is extended to June 15, 2020. The filing date for the 2019 Form CT-990T Connecticut unrelated business income tax return is extended to June 15, 2020, while the payment deadline is extended until June 15, 2020. (DRS Extends Filing Deadline for Certain Annual State Business Tax Returns, Conn. DRS, 03/16/2020.)
District of Columbia. L. 2020, Act 23-247, effective 03/17/2020 (expires 06/15/2020), enacts the “COVID-19 Response Emergency Amendment Act of 2020.” The emergency legislation, enacted to address the COVID-19 pandemic, provides that the Chief Financial Officer (CFO) may waive penalties and abate interest for failure to timely pay sales and use tax for periods ending on February 29, 2020 or March 31, 2020, provided that all taxes for such periods are paid in full on or before July 20, 2020. The waiver does not apply to hotels or motels that are permitted to defer property tax under another provision of the emergency legislation. Under this provision of the emergency legislation, for property that is commercially improved and occupied and is a hotel or motel, the CFO may waive penalties and abate interest for the first installment of real property tax for the 2020 tax year (due on or before March 31) provided the property owner pays the installment by June 20, 2020. The D.C. Office of Tax and Revenue must issue guidance on the definition of a hotel or motel for this purpose. The legislation is made applicable as of March 11, 2020.
On March 17, 2020, the District of Columbia enacted the “COVID-19 Response Emergency Amendment Act of 2020” (the Act) which expanded the authority of the D.C. Office of Tax and Revenue (OTR) to abate interest and waive penalties for failure to timely pay sales and use tax due for periods ending on February 29, 2020 and March 31, 2020, provided certain conditions are met. Consequently, the OTR will automatically waive interest and penalties that would ordinarily be assessed for failure to timely pay sales and use tax due for the periods ending on February 29, 2020 and March 31, 2020. All vendors who are required to file sales and use tax returns on either a monthly or a quarterly basis are eligible for this relief, except for hotels and motels permitted to defer real property taxes under the Act. Any hotel or motel vendor registered with OTR with the NAICS code 72111, 721110, 72112 or 721120 is ineligible for this relief. Monthly filers must file a Form FR-800M as usual through MyTax.DC.gov on or before March 20, 2020 for the period ending February 29, 2020 and on or before April 20, 2020 for the period ending March 31, 2020. Quarterly filers must file a Form FR-800Q as usual through MyTax.DC.gov on or before April 20, 2020 for the period ending March 31, 2020. All eligible vendors must pay in full all sales and use taxes due for periods ending on February 29, 2020 and March 31, 2020 on or before July 20, 2020. Failure to pay in full by July 20, 2020 will result in interest and penalties accruing from the original payment due dates. (Release, D.C. Office of Tax and Revenue, 03/20/2020.)
Hawaii. In its March 20, 2020 COVID-19 Operational Status update, the Department of Revenue stated that all due dates are presently unchanged. (Department of Taxation: COVID-19 Operational Status, 03/20/2020.)
Illinois. The Illinois Attorney General issued an important notice that, due to closures related to COVID-19, estates with returns and payments due between March 16, 2020 and April 15, 2020 will receive a 30-day extension for filing and payment. An extension of time to pay does not waive or abate statutory interest. Payments must be sent to the Illinois State Treasurer, using a fillable form to make payment of the Illinois Estate Tax, which can be downloaded from the Treasurer’s website. Staff may not be available to receive returns in person at the Springfield office. Taxpayers filing returns in Chicago should use the James R Thompson Center through the Lake Street entrance; however, taxpayers are encouraged to file returns and extension requests by mail. Cook, DuPage, Lake, and McHenry counties should file with the Chicago office, and all other counties should file with the Springfield office. (Important Notice, Attorney General’s Office, 03/18/2020.)
The Illinois Department of Revenue issued an informational bulletin to all registered Illinois retailers operating eating and drinking establishments. The Department is waiving all penalties and interest that would have been imposed on sales tax payments for qualified taxpayers. Eligible taxpayers are taxpayers who operate eating and drinking establishments that incurred a total sales tax liability of less than $75,000 in calendar year 2019. Qualified taxpayers will not be charged penalties or interest on late payments for payments that are due in the February, March and April 2020 reporting periods. For most qualified taxpayers, the Department will automatically waive penalties and interest, but if a taxpayer thinks they received a notice from the Department owing interest and penalties, in error, then the taxpayer can respond to the notice with a waiver request. Taxpayers must still file Form ST-1 for each reporting period. Taxpayers must pay their liabilities due in March, April, and May 2020, for liabilities reported on Form ST-1, as follows: 1/4 of the liability for February, March, and April 2020 reporting periods is due May 20, 2020; 1/4 of the liability for February, March, and April 2020 reporting periods is due June 22, 2020; 1/4 of the liability for February, March, and April 2020 reporting periods is due July 20, 2020; and 1/4 of the liability for the February, March, and April 2020 reporting periods is due August 20, 2020. (Illinois Dept. of Rev. Info. Bulletin No. FY 2020-23, 03/01/2020.)
Indiana. Governor Eric Holcomb announced the Indiana Department of Revenue (DOR) is extending certain filing and payment deadlines to align with the Internal Revenue Service and support taxpayers during the COVID-19 health crisis. Individual tax returns and payments, along with estimated payments originally due by April 15, 2020, are now due on or before July 15, 2020. Returns included are the IT-40, IT-40PNR, IT-40RNR, IT-40ES, ES-40 and SC-40. Corporate tax returns and payments, along with estimated payments originally due by April 15 or April 20 are now due on or before July 15, 2020. Those originally due on May 15, 2020, are now due on August 17, 2020. Returns included are the IT-20, IT-41, IT-65, IT-20S, FIT-20, URT-1, IT-6, FT-QP and URT-Q. All other tax return filings and payment due dates remain unchanged. If taxpayers need additional time to file, they can request an extension. Instructions for those extensions can be found on the DOR’s website. If an individual requests a federal extension, Indiana automatically extends the state deadline and there is no need to file anything additional. (DOR Announces Filing and Payment Extensions, Ind. Dept. of Rev., 03/19/2020.)
The State of Indiana ordered all property taxes to remain due on May 11, 2020, however, counties must waive penalties on payments after May 11, 2020 for a period of 60 days. This waiver does not apply to tax payments which have been escrowed by financial institutions on behalf of property taxpayers. (Executive Order 20-05, State of Indiana, 03/19/2020.)
The State of Indiana ordered, subject to the DOR approval, that the manufacturers making donations of medicine, medical supplies, or other goods in the furtherance of fighting the COVID-19 pandemic will not be subject to Indiana use tax on those items donated. In addition, subject to the DOR approval, groups or organizations that are not manufacturers who make any donations of medicine, medical supplies, or other goods will not incur a use tax obligation if sales tax had not been paid on such items, that in either case, these donations will not be considered retail transactions subject to sales or use tax. Donation of these items will not entitle the donor to a refund of any sales or use tax previously paid to the DOR or to a vendor. (Executive Order 20-05, State of Indiana, 03/19/2020.)
Iowa. The Iowa Department of Revenue has ordered the extension of filing and payment deadlines for income, franchise, and moneys and credits taxes with a due date on or after March 19, 2020, and before July 31, 2020, to a new deadline of July 31, 2020. Specifically, the order includes: IA 1040C Composite Return and all supporting forms and schedules; IA 1041 Fiduciary Return and all supporting forms and schedules; IA 1120 Corporation Income Tax Return and all supporting forms and schedules; IA 1120F Franchise Tax Return for Financial Institutions and all supporting forms and schedules; IA 1065 Iowa Partnership Return and all supporting forms and schedules; IA 1120S S Corporation Return and all supporting forms and schedules; Credit Union Moneys and Credits Tax Confidential Report. The extension does not apply to estimated tax payments. No late-filing or underpayment penalties will be due for qualifying taxpayers who comply with the extended filing and payment deadlines. Interest on unpaid taxes covered by the order will be due beginning on August 1, 2020. (Iowa Extends Filing/Payment Deadline for Several Tax Types, Iowa Dept. of Rev., 03/19/2020.)
The Department has ordered the extension of one income tax withholding deposit due date for certain taxpayer in response to the COVID-19 emergency. The income tax withholding deposit due date for the period ending March 15, 2020 is extended from March 25, 2020, to the new deposit due date of April 10, 2020. It applies to Iowa residents or other taxpayers doing business in Iowa who remit income tax withholding on a semi-monthly basis. No late-filing or underpayment penalties will be due for qualifying taxpayers who comply with the extended filing and payment deadlines. Interest on unpaid taxes will be due beginning on April 11, 2020. (Extended Income Tax Withholding Due Date, Iowa Dept. of Rev., 03/19/2020.)
Louisiana. Louisiana Governor John Bel Edwards has issued a proclamation regarding measures for the COVID-19 public health emergency, which affects certain legal tax proceedings. Legal deadlines, including liberative prescription and preemptive periods applicable to legal proceedings in all courts, administrative agencies, and boards, are suspended until at least Monday, April 13, 2020, including any such deadlines set forth within Title 47 of the Louisiana Revised Statutes, Revenue and Taxation. (Proclamation No. JBE 2020-30, 03/16/2020.)
The Louisiana Department of Revenue is providing filing and payment extension relief for certain taxes due March 20, 2020. The February 2020 sales tax returns and payments and excise tax returns and payments for Wine Shipped Direct to Consumers and the Louisiana State and Parish and Municipal Beer Tax that are due March 20, 2020, are extended to May 20, 2020. This is an automatic extension and no extension request is necessary. The Department will waive delinquency penalties and compromise interest associated with delinquent sales and excise tax remittances provided the return and payment are received by the extended due date of May 20, 2020. The Department also is temporarily suspending collection activity by distraint and sale on delinquent taxpayer accounts. However, delinquency interest and penalties will continue to accrue in accordance with the statutory requirements on unpaid balances. (Louisiana Revenue Information Bulletin No. 20-008, 03/19/2020; News Release, Department of Revenue Extends State Sales Tax Deadline Due to Coronavirus Public Health Emergency, Louisiana Department of Revenue, 03/19/2020.)
Maryland. Maryland Comptroller Peter Franchot announced that business-related tax filing deadlines are extended to June 1, 2020. The extension is intended to assist businesses affected by the economic impact of COVID-19. The extension applies to certain business returns with due dates during the months of March, April, and May 2020 for businesses filing the following returns: sales and use tax; withholding tax; admissions and amusement tax; alcohol tax; tobacco tax; motor fuel excise tax; tire recycling fee; and the bay restoration fee. Business taxpayers who file and pay by the extended due date will receive a waiver of interest and penalties. However, filing due dates for Maryland corporate and individual income tax returns will be extended if the IRS extends its April 15, 2020 filing deadline. Businesses with extension-related questions can call the Comptroller’s Ombudsman at (410) 260-4020, or send an email to taxpayerrelief@marylandtaxes.gov. (News Release, Maryland Comptroller’s Office, 03/11/2020; Further Explanation of Tax Extensions Announced By Comptroller Franchot, Maryland Comptroller’s Office, 03/18/2020.)
Businesses who paid their Maryland sales and use taxes for March 2020 early can request a refund of their payment by emailing taxpayerrelief@marylandtaxes.gov or by calling (410) 260-4020. (News Release, Maryland Comptroller’s Office, 03/20/2020.)
No interest or penalty for late income tax payments will be imposed if Maryland business and individual income taxpayers make 2019 tax payments by July 15, 2020. Maryland is following the relief provided by the federal government’s 90-day extension of the April 15, 2020 deadline for federal income tax payments because of COVID-19. Fiscal year filers with tax years ending January 1, 2020 through March 31, 2020 are also eligible for the payments extension. However, taxpayers who take advantage of the federal extension to file their return, which is separate from the relief granted to pay their taxes, will continue to be automatically granted an extension on their Maryland tax filings. No additional filing extension forms are required. (News Release, Maryland Comptroller’s Office, 03/18/2020.)
To clarify, April 15, 2020 remains the deadline for income tax returns. Taxpayers must file for an extension for filing federal income tax returns by this date, and if filed, no separate Maryland income tax filing extension is necessary and the deadline would be extended to October 15, 2020. However, with regard to income tax, the due date has been extended to July 15, 2020, and includes individual, corporate, pass-through entities, and fiduciary income tax payments, as well as March quarterly estimated payments. (Further Explanation of Tax Extensions Announced By Comptroller Franchot, Maryland Comptroller’s Office, 03/18/2020.)
Massachusetts. The Massachusetts Department of Revenue has adopted an emergency regulation amendment (adding section (7) to to 830 CMR 62C.16.2, Sales and Use Tax Returns and Payments), that suspends return filing and payment remittance obligations for certain vendors during the COVID-19 state of emergency. Specifically, the sales and use tax filing and payment schedule for vendors, whose cumulative sales and use tax liability in the 12-month period ending February 29, 2020 is less than $150,000, will be as follows: Returns and payments due during the period beginning March 20, 2020 and ending May 31, 2020, inclusive, will be suspended. All such returns and payments will be due on June 20, 2020. The suspension does not apply to marijuana retailers, marketplace facilitators or vendors selling motor vehicles who have to continue to file returns and make payments.
The Department has adopted an emergency regulation amendment (adding new subsection (11)(g) to 830 CMR 64G.1.1, Room Occupancy Excise) which suspends return filing and payment remittance obligations for certain operators during the COVID-19 State of Emergency declared by the governor. Specifically, the filing and payment schedule for operators, whose cumulative liability in the 12-month period ending February 29, 2020 is less than $150,000, will be as follows. Returns and payments due during the period beginning March 20, 2020 and ending May 31, 2020, inclusive, will be suspended. All such returns and payments, including any local option amount will be due on June 20, 2020. The suspension does not apply to intermediaries that must continue to file returns and make payments.
The Department will waive any late-file or late-pay penalties imposed under Mass. Gen. L. Ch. 62C § 33 for returns and payments due during the period March 20, 2020 through May 31, 2020, for the following: (1) vendors with meals tax return and payment obligations pursuant to G.L. c. 62C, § 16 that do not otherwise qualify for relief announced in Emergency Regulation 830 CMR 62C.16.2(7) promulgated by the Department on March 19, 2020 (see above); and (2) operators and intermediaries with room occupancy excise return and payment obligations that do not otherwise qualify for relief announced in Emergency Regulation 830 CMR 64G.1.1(11)(g) promulgated by the Department on March 19, 2020 (see above). Only penalties are being waived; statutory interest will continue to accrue. To be eligible for a penalty waiver, vendors, operators and intermediaries must file their returns and remit payments on or before June 20, 2020. The penalty waiver is limited to the taxpayers and tax periods outlined above. Applications for waiver of penalties for sales tax other than sales tax on meals, or other circumstances not covered above, will be handled on a case-by-case basis based on reasonable cause. (Massachusetts Technical Information Release No. 20-2, 03/19/2020.)
Michigan. Due to the disruptions to the normal business operations of many sales, use, and withholding taxpayers required to file returns and remit tax by the 20th day of each month due to the COVID-19 outbreak, the Department of Treasury is waiving penalty and interest for the late payment of tax or the late filing of the return due on March 20, 2020. The waiver will be effective for a period of 30 days; therefore, any return or payment currently due on March 20, 2020 may be submitted to the Department without penalty or interest through April 20, 2020. The waiver is limited to sales, use, and withholding payments and returns due March 20, 2020. Any payment or return otherwise due after that date will not be eligible for the current waiver. The waiver is not available for accelerated sales, use, or withholding tax filers. Those taxpayers should continue to file returns and remit any tax due as of the original due dates. (Notice: Penalty and Interest Waived for 30 Days for Monthly Sales, Use, and Withholding Tax Returns Due March 20, 2020, Mich. Dept. Treas., 03/17/2020; Treasury: Small Business Taxpayers Provided Tax Assistance, Mich. Dept. Treas., 03/18/2020.)
On March 18, 2020, Michigan Governor Gretchen Whitmer signed an Executive Order, effective immediately, that extends the property tax foreclosure deadline under Mich. Comp. Laws Ann. § 211.78g(3) for Michigan residents to pay back taxes and avoid foreclosure in their property during the ongoing COVID-19 pandemic. The Executive Order moves the tax foreclosure deadline from March 31, 2020, to May 29, 2020, or 30 days after the state of emergency declared in Executive Order 2020-04 is terminated, whichever comes first. The Executive Order encourages the State Court Administrative Office to urge judges of the circuit court to amend orders of foreclosure issued in 2020 under Mich. Comp. Laws Ann. § 211.78k(5), in a manner consistent with the deadline extension. (Executive Order 2020-14, 03/18/2020; Governor’s Press Release, 03/18/2020.)
Minnesota. The Minnesota Department of Revenue notes that the Internal Revenue Service has extended the deadline for federal income tax payments only to July 15, 2020, for payments due of up to $1 million for individuals and $10 million for corporations. At this time, federal and Minnesota individual income tax returns are still due April 15, 2020. The Department continues to monitor the situation and will communicate any changes to Minnesota tax filing or payment deadlines on its website. If a taxpayer is unable to file and pay on time because of COVID-19 illness or related situation, the taxpayer may ask the Department to abate (cancel) penalties and interest for late filing or payment if the taxpayer has a reasonable cause. (Our Response to COVID-19, Minn. Dept. Rev., 03/19/2020.)
The Department is granting a 30-day sales and use tax grace period for businesses identified in Minnesota Governor Tim Walz’s Executive Order 20-04. During this time the Department will not assess penalties or interest. Identified businesses with a monthly sales and use tax payment due March 20, 2020, will have until April 20 to make that payment. These customers should still file their return by March 20. At this time, this grace period for penalty and interest is only for monthly filers and only for the March 20 payment. Identified businesses can request additional relief from penalty and interest for reasonable cause after April 20. Executive Order 20-04, as amended by Executive Order 20-08, provides for the temporary closure of bars, restaurants, and other places of public accommodation. (Sales Tax Payment Extension for Businesses Identified in Executive Order 20-04, Minn. Dept. Rev., 03/18/2020.)
Montana. The Montana Department of Revenue has issued a release concerning taxpayer payment plans. With many Montana taxpayers facing disruption and uncertainty related to COVID-19, the Collections Bureau will do its best to accommodate and work with taxpayers during this time. The Collections Bureau will assess situations on a case-by-case basis and may allow deferral of payments for up to one month at a time. Taxpayers seeking deferrals must contact the Collections Bureau via phone, email, or web message at least one week prior to their payment due date to request deferral of payment. (Montana Department of Revenue Release—Payment Plans, 03/18/2020.)
Nebraska. Nebraska Governor Pete Ricketts has issued Executive Order No. 20-06 providing, in part, penalty and interest relief for manufacturers or wholesalers of alcoholic beverages who make late payments on their excise taxes. The waiver of penalty and interest will continue through the duration of the COVID-19 state of emergency. (News Release: Gov. Ricketts Issues Executive Order to Provide Relief to Restaurants and Bars during COVID-19 Emergency, Office of Governor Pete Ricketts, 03/19/2020.)
North Carolina. The North Carolina Department of Revenue has issued an important notice to inform taxpayers who have been affected by COVID-19 of a limited-time waiver of certain penalties. On March 10, 2020, North Carolina Governor Roy Cooper signed Executive Order 116 declaring a state of emergency in response to COVID-19. The Secretary of Revenue has become aware that, because of COVID-19, some taxpayers may not be able to meet certain filing or payment requirements. In response, the Secretary has elected to waive the following penalties: the penalty for failure to obtain a license; the penalty for failure to file a return; the penalty for failure to pay tax when due; and the penalties regarding informational returns. The waiver applies to the failure to timely obtain a license, file a return, or pay a tax that is due between March 15, 2020, and March 31, 2020, if the license is obtained, the return or extension application is filed, or the tax is paid by April 15, 2020. The waiver will be considered a waiver for special circumstances. The waiver will not be considered a waiver for good compliance that can only be granted once every three years per tax type. Affected taxpayers who cannot meet their filing or payment requirement as a result of COVID-19 should complete Form NC-5500 (Request to Waive Penalties) and write “COVID-19” on the top of the form. For affected taxpayers who do not have access to Form NC-5500, they can request a penalty waiver by attaching a letter containing: the taxpayer’s name; address; SSN or FEIN; Account ID; and the tax type and tax period for which the taxpayer seeks waiver of penalty. Form NC-5500 or the letter should be mailed to the North Carolina Department of Revenue, Customer Service, P.O. Box 1168, Raleigh, NC 27602. (Important Notice: Department of Revenue Provides Penalty Relief to Persons Affected by Novel Coronavirus Disease, N.C. Dept. of Rev., 03/17/2020.)
North Dakota. The North Dakota Office of State Tax Commissioner has issued guidance on tax issues related to COVID-19. The guidance states that North Dakota individual and business income tax returns and payments are due on April 15, 2020. However, individuals or businesses who are unable to file an income tax return or pay the tax by the April 15th deadline, can file and make payment through July 15, 2020, without penalty and interest. With regard to other taxes, if taxpayers have a financial hardship and are unable to file a return or pay the tax in a timely manner because of a COVID-19 related situation, requests for assistance will be considered by the Tax Commissioner. (COVID-19 Guidance, 03/20/2020.)
Oklahoma. Oklahoma Governor J. Kevin Stitt ordered the temporary suspension of the costs and fees for oversize/overweight permits required of carriers whose sole purpose is transportation of materials, equipment, and supplies used for direct assistance in support of emergency relief efforts which would normally require an overweight permit in response to the COVID-19 outbreaks. (Amended Executive Order 2020-07, Oklahoma Tax Commission, 03/17/2020.)
The Oklahoma Tax Commission is extending the deadline to pay Oklahoma income taxes that would be due April 15, 2020 to July 15, 2020, following the newly established Internal Revenue Service deadlines applicable to income tax due. This payment extension applies for tax year 2019 and the first quarter payment for tax year 2020, both of which would normally be due on April 15, 2020. Mirroring the guidance issued by the IRS, all individual and other non-corporate tax filers may defer up to $1 million of income tax payments due on April 15, 2020, until July 15, 2020, without penalties or interest. Corporate taxpayers will be granted a similar deferment of up to $10 million of income tax payments that would be due on April 15, 2020, until July 15, 2020, without penalties or interest. (Oklahoma Tax Commission to allow deferred tax payments due to COVID-19, Oklahoma Tax Commission, 03/19/2020.)
Oregon. The Oregon Department of Revenue has provided guidance on the tax relief it is offering taxpayers due to the COVID-19 pandemic. With regard to the corporate activity tax (CAT), since the pandemic may impact commercial activity to an extent that makes it difficult for businesses to estimate their first CAT payment, due April 30, 2020, the Department will not assess underpayment penalties on taxpayers making a good faith effort to estimate their first quarter payments. With regard to the personal income tax and corporate income tax, since the Department knows what relief the IRS is providing, the Department is evaluating its options and authority under the statutes to provide relief for Oregon and its taxpayers, and expects to make a decision soon. Federal relief will allow all individual and other non-corporate tax filers to defer up to $1 million of federal income tax, including self-employment tax, payments due on April 15, 2020 until July 15, 2020, without penalties or interest, and will allow corporate taxpayers a similar deferment of up to $10 million of federal income tax payments that would be due on April 15, 2020 until July 15, 2020, without penalties or interest. The federal April 15 filing deadline is not changed. With regard to other tax programs administered by the Department, if an action of the IRS or a state-declared emergency will impair the ability of either Oregon taxpayers or the state to take action required within the time required by law, the Department may extend any statutory period of limitation on any tax that it collects. If the Department makes such a decision, an order will be issued and announced, and filed with the Secretary of State. (COVID-19 Tax Relief Options, Or. Dept. Rev., 03/19/2020.)
South Carolina. The South Carolina Department of Revenue (DOR) is providing special filing and payment relief to those impacted by COVID-19 in South Carolina. This includes individuals and businesses located in South Carolina, taxpayers who have businesses with offices in South Carolina, taxpayers whose tax records are located in South Carolina, or taxpayers whose returns are prepared by impacted tax professionals. Starting on April 1, 2020, the tax relief postpones various tax filing and payment deadlines for any taxes administered by, or tax returns filed with the DOR, including but not limited to, income tax, sales and use tax, admissions tax and motor fuel user fee returns. Affected individuals and businesses will have until June 1, 2020 to file and pay taxes for returns that are due between April 1, 2020 and June 1, 2020. Returns filed electronically through MyDORWAY do not require any action to qualify for this relief. Taxpayers filing by mail should write “CORONAVIRUS” or “COVID-19” at the top of any paper return relying on this relief or complete the “disaster area” check box if one is provided on the return. Taxpayers with questions concerning county property taxes should contact the county government where the property is located. (South Carolina Information Letter No. 20-3, 03/17/2020.)
Texas. Texas Comptroller Glenn Hegar reminds businesses that the sales tax collected in February 2020 must be remitted by March 20, 2020. Although this may be difficult for businesses due to COVID-19, the tax represents money collected from individual Texans and expected to be available to provide emergency health care and support other emergency operations. The comptroller urges businesses to make use of the agency’s online tools to meet the March 20 deadline. For taxpayers who must visit the agency’s field offices, protocols have been put in place to ensure proper social distancing and protect the safety of both taxpayers and agency employees. Future tax due dates will be examined as they approach. (News Release, Texas Comptroller of Public Accounts, 03/17/2020.)
Utah. The Utah State Tax Commission has announced the following changes to comply with recommendations to help slow down the spread of COVID-19: (1) The due date of the Utah individual income tax return is the same day as the due date of the federal individual income tax return; if the IRS changes the due date due to the outbreak, Utah’s due date will also be extended. However, Utah offers an automatic 6-month extension for filing personal income tax returns. (2) The due dates of Utah corporate and pass-through entities is set by state statute and will not be affected by IRS changes in the due dates for those returns without action by the legislature. (3) Telephone agents will be available at (801) 297-2200 or (800) 662-4335 for assistance Monday through Friday, 8:00 a.m. – 5:00 p.m and counter agents will only be available for immediate lien release with certified funds (cashier’s check or cash) and cash payments. (4) E-filed returns with refunds will not be delayed. (5) All scheduled tax appeals hearings will be held by telephone from March 23 through April 24, 2020; due to COVID-19 precautions, the Tax Commission will hold all events as scheduled, but will hold the events via telephone conference only. (6) Property Tax Division functions will continue without interruption with email being the best form of communication. (News Release: Procedural Changes Due to COVID-19, Utah State Tax Comm’n, 03/17/2020; Notice, Utah State Tax Comm’n, 03/17/2020.)
While the IRS has extended the deadline for payment of 2019 Individual Income Tax due (up to $1 million) and Corporate Income Tax due (up to $10 million) to July 15, 2020, Utah income tax payments must be made by April 15, 2020. The deadline for payment of Utah state income taxes has not changed at this time, although Utah offers an automatic 6-month extension to file these tax returns. (Updated News Release on Utah STC Procedure Due to COVID-19 Pandemic, Utah State Tax Comm’n, 03/19/2020.)
Virginia. The Virginia Department of Taxation issued a bulletin regarding income tax payment deadlines as a result of the COVID-19 crisis. All income tax payments due between April 1, 2020 to June 1, 2020, can be submitted to the Department any time on or before June 1, 2020. The Department will automatically waive late payment penalties as long as full payment is received by June 1, 2020. If the full amount is not paid by June 1, 2020, the penalty waiver will not apply, and late payment penalties will accrue from the original date that the payment was due. Interest will continue to accrue from the original date of the payment, so those who are able to pay are encouraged to do so. The following taxes are eligible for the payment extension and penalty waiver: individual, corporate, fiduciary income taxes, and any estimated income tax payments during this period. The waiver does not provide a filing extension and all returns are due by their relevant due dates. Virginia does provide an automatic filing extension to all taxpayers for up to six months (seven months for certain corporations), and no application is required to apply the extension. (Virginia Tax Bulletin 20-4, Va. Dept. of Tax’n., 03/20/2020.)
The Department issued a bulletin with important information for those affected by the COVID-19 crisis. The Department will consider requests from sales tax dealers for an extension on filing and paying the February 2020 sales tax return, which is due on March 20, 2020. If a request is granted, then the filing and payment will be April 20, 2020, with a waiver of penalties. However, even with an extension, interest will accrue. Dealers should request a waiver using the Department’s secure email system or by writing to the following address: Virginia Tax, Office of Customer Services, P.O. Box 1115, Richmond, VA 23218-1115. (Virginia Tax Bulletin 20-3, Va. Dept. of Tax’n., 03/19/2020.)
This article originally appeared in the March 23, 2020 edition of State Tax Update.
