According to a new report from CBS News, the IRS is planning to delay the tax filing deadline from its usual slot on April 15 to May 17. Congressional sources told the outlet that the federal tax deadline will move to accommodate the coronavirus pandemic, as it did last year. The IRS itself is also behind, catching up on last year's tax filings and stimulus check distribution.
The American Institute of CPAS has reportedly asked the IRS to delay the tax filing deadline for 2021, and the agency will likely comply. Lawmakers are on board too — praising the move before the IRS has even made it official or commented on it publicly. In a statement published on Wednesday, Reps. Bill Pascrell Jr. and Richard Neal said: "This extension is absolutely necessary to give Americans some needed flexibility in a time of unprecedented crisis. Under titanic stress and strain, American taxpayers and tax preparers must have more time to file tax returns."
"While we are pleased with this 30-day extension, we will continue to monitor developments during this hectic filing season," they added. Those lawmakers agreed with the AICPA in saying that both taxpayers and the IRS itself need more time to sort out their finances this year.
They pointed out the logistical struggles of the agency, which had unexpected trouble managing its shift to remote work in 2020. With no centralized office, the IRS has been slow at processing paper tax returns filed by mail. "Even the IRS — faced with a significant mail processing backlog, a delayed start of the 2021 tax season, inundated phone lines and a new round of COVID-19 relief payments — is overwhelmed," the AICPA said.
Taxpayers and financial advisers can also use this extra time to sort out the minutia of the new $1.9 trillion stimulus package, which came with all kinds of new amendments. Filers can now take a tax exemption on up to $10,200 in unemployment benefits, and they can claim any missing stimulus check money from the last three rounds of payments.
Still, not all professionals in the financial sector are pleased. According to a report by Bloomberg, the shift will likely complicate earning reports for H&R Block, and presumably other corporate tax filing services. An insider told the outlet "The shit could push $500 million of revenue" from the fourth quarter into the first quarter of H&R Block's next fiscal year.
For taxpayers themselves, the move remains a net positive. At the time of this writing, the tax-filing deadline officially remains April 15, 2021, but reports strongly indicate it will move to May 17. Visit the IRS website for the latest information.