03.30.2020 IRS Extends Filing Deadline for Federal Gift Tax and Generation-Skipping Transfer Tax Returns
In response to the COVID-19 pandemic, the Internal Revenue Service (the IRS) issued various notices addressing both payment and filing deadlines for taxpayers. On March 18, 2020, for example, the IRS issued Notice 2020-17, which postponed the due date for various tax payments (but not the filing of returns) from April 15 to July 15. Soon thereafter, on March 20, 2020, the IRS issued Notice 2020-18 and extended the due date for the filing of various returns, as we covered here, including the U.S. Individual Income Tax Return, Form 1040, thereby effectively moving “Tax Day” from the traditional April 15 deadline to July 15.
Notably absent from these Notices was an extension of time to file Federal Gift and Generation Skipping Transfer Tax Returns, Forms 709.
Thankfully, the IRS issued Notice 2020-20, which amplifies the relief provided in Notice 2020-18 by providing specific guidance for taxpayers required to file Form 709 for the 2019 tax year. Both the filing deadline for Form 709 and the due date for all related tax payments are extended from April 15, 2020 to July 15, 2020. This change to the filing and payment deadline is automatic and does not necessitate the filing of a Form 8892 (Application of Automatic Extension of Time to File Form 709 and/or Payment of Gift/Generation-Skipping Transfer Tax) in order to take advantage of the later due date. Should a taxpayer who is required to file a 2019 Form 709 wish to request an additional extension of time to file, however, he or she may file Form 8892 in order to delay the due date for the filing of Form 709 to October 15, 2020. It is important to note, however, that filing Form 8892 will not extend the deadline for tax payments due with the Form 709, but only the deadline for filing the return itself. The due date for payment will be July 15, regardless of whether Form 8892 has been filed.
Finally, Notice 2020-20 provides that interest, penalties, and additions to tax for failure to file or make tax payments due with Form 709 will not accrue between April 15 and July 15, but will begin to accrue only on July 16, 2020.
There is no discussion in Notice 2020-20 of any extension of time to file a Federal Estate and Generation Skipping Transfer Tax Return, Form 706. These returns are typically due nine months after the date of death of a decedent. An automatic six-month extension of time to file Form 706 can be obtained by filing Form 4768.
Williams Mullen will continue to monitor the actions taken by the IRS to provide relief to taxpayers during the COVID-19 pandemic. For further information, please contact any member of our team.
Please note: This alert contains general, condensed summaries of actual legal matters, statutes and opinions for information purposes. It is not meant to be and should not be construed as legal advice. Readers with particular needs on specific issues should retain the services of competent counsel.