State income tax relief in the form of tax return filing and tax payment extensions, and the deployment of related administrative guidance, has evolved rapidly in the last several weeks in the face of the COVID-19 crisis. Of the 45 jurisdictions, including the District of Columbia, that impose an income tax on corporations, 40 have established income tax relief to corporate taxpayers in the form of tax payment extensions, return filing extensions and/or various penalty and interest relief during the extension period. Arkansas, Minnesota and Montana are playing hardball, affirmatively announcing no income tax relief will be provided to corporate taxpayers. Massachusetts has announced it purportedly does not have the authority to extend income tax filing or payment deadlines to corporations but has provided late-filing and late-payment penalty relief. And unique as always, Florida still appears to be on the fence.
With the exception of Wisconsin, many states have not publicly stated whether they will be following the latest Federal tax relief announced on April 9, 2020, by the Department of Treasury and IRS in Notice 2020-23. In March, the IRS announced taxpayers generally have until July 15, 2020, to file returns and pay federal income taxes originally due April 15. IRS Notice 2020-23 extends this relief to various additional returns, tax payments and other actions. As a result, the extensions now generally apply to all taxpayers that have any type of Federal tax filing or payment deadline falling on or after April 1, 2020, and before July 15, 2020.
See our latest matrix for comprehensive coverage as of April 13, 2020, on state income tax relief to corporations, other business entities, and individuals. Our coverage is organized in a manner that is quick to digest, and links to primary source authority are provided for ease of reference and to track future developments. Pillsbury’s state and local tax team will continue to monitor these tax relief developments in the ever-changing landscape of the COVID-19 pandemic.