Question re delayed federal estimated tax payments

[FEDUKE404]

Never mind.

[Maude Lebowski]

I think you're overthinking it. The 1Q payment is still payment number 1. Only its due date has changed.

[Rapid Robert]

(Why do I foresee the 2020 Form 2210 to be a multi-page form. . .?)

It already is a multi page form.

To review, a required payment is normally due by 4/15 for income earned Jan 1-Mar 31. If the required payment isn't made in full by 4/15, interest starts accruing daily on the underpaid amount until it is paid. Next, a required payment is normally due on 6/15, for income earned Jan 1-May 31. Again, if the required payment (including prior underpaid amounts) isn't made in full by 6/15, interest starts accruing daily until it is paid.

A few things haven't been addressed yet, so we don't know the answer. I suspect withholding will still be treated as if it was made evenly throughout the year (this will help those who are laid off now but start working again later in the year). Otherwise, it seems the simplest thing is to simply treat the underpayment interest rate as zero through July 15. This way, nothing about the basic design of the form would really need to change, as it already is designed to take into account changes in interest rate during the year.

[Dude]

I think you're overthinking it. The 1Q payment is still payment number 1. Only its due date has changed.

Agree. Delaying the first payment to July but making the second payment in June seems to defeat the purpose of taxpayers holding on to their cash for emergencies. If you want to make a payment in June then just make the first payment in June. I think the assumption is that all following quarterly payments are also delayed accordingly. At the very least they would not expect the 2nd payment until September 15

[dtlee]

I got FE's joike, but the IRS gets the last laugh.

The first payment will be due 7/15 while the second payment is due 6/15. Normally any overage from the first payment reduces the amount due in the second payment. However, if we have an extra month to make the first payment after the second, we can pay less on the second payment and overpay the first payment later.

Ouch my head hurts.

Source:

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

Q16. The Notice postpones the deadline for first quarter 2020 estimated income tax payments due on April 15, 2020. What about second quarter estimated tax payments due on June 15? Have they been postponed as well?

A16. No, second quarter 2020 estimated income tax payments are still due on June 15, 2020. First quarter 2020 estimated income tax payments are postponed from April 15 to July 15, 2020.

[rbynaker]

The first payment will be due 7/15 while the second payment is due 6/15. Normally any overage from the first payment reduces the amount due in the second payment. However, if we have an extra month to make the first payment after the second, we can pay less on the second payment and overpay the first payment later.

Oddly enough, I completely followed your logic on that and I kind of agree with you. If the 7/15 payment is deemed to have been made on 4/15 then making the 6/15 payment one month late actually makes it two months early. They have managed to introduce time travel into tax law. Brilliant.

Rick

[dtlee]

Oddly enough, I completely followed your logic on that and I kind of agree with you. If the 7/15 payment is deemed to have been made on 4/15 then making the 6/15 payment one month late actually makes it two months early. They have managed to introduce time travel into tax law. Brilliant.Rick

Back to the Future:
https://www.irs.gov/newsroom/irs-ext...ons-and-others

Emphasis added:

Estimated Tax Payments

Besides the April 15 estimated tax payment previously extended, today’s notice also extends relief to estimated tax payments due June 15, 2020. This means that any individual or corporation that has a quarterly estimated tax payment due on or after April 1, 2020, and before July 15, 2020, can wait until July 15 to make that payment, without penalty.

It is also discussed in Notice 2020-23:
https://www.irs.gov/newsroom/irs-ext...ons-and-others

In other words, the four federal estimated due dates are now 7/15, 7/15, 9/15, 1/15. States can now try to re-align again. California already had these dates.

[Burke]

Ain't it fun?

[dtlee]

(This is an old thread)
Actually, the payment date for IRS #2 2020 estimated tax payment remains unchanged at June 15th.

Not sure if you are saying this tongue-in-cheek, but they changed this within the past 48 hours.

[dtlee]

Understood. That's why I did not start a new thread. Trying to keep information together even though it is coming in piecemeal.