CARES Act and extensions update - Spidell

CARES Act and extensions update


Today’s update includes a correction to yesterday’s Flash E-mail and new information on California extensions.

Correction to March 30 Flash E-mail on the CARES Act

All businesses, other than those who receive loan forgiveness under the Paycheck Protection Loan Program, may defer their employment taxes (OASDI at 6.2%, but not Medicare at 1.45%) for the period March 27, 2020, through December 31, 2020, as follows:

  • 50% due on December 31, 2021; and
  • 50% due on December 31, 2022.

Self-employed individuals may similarly defer their employer-share (50%) of their self-employment taxes. At this point, it is unclear how this will work with the deduction of 50% of the self-employment tax on the tax return. (CARES Act §2302)

New California payment and filing extensions announced

In response to the Governor’s latest executive order (N-40-20), the CDTFA and FTB have announced the following extensions:

CDTFA

First quarter CDTFA tax payments and filings, including sales and use tax returns, are now due July 31, 2020, for all businesses filing a return for less than $1 million in tax.

All taxpayers have an additional 60 days to file claims for refund of any CDTFA-administered taxes, or to file an appeal of a CDTFA determination with the Office of Tax Appeals, effective March 30, 2020, through July 31, 2020.

FTB

Taxpayers will have until July 15, 2020, to file the following items that would normally be due during the period March 12, 2020, through July 15, 2020 (FTB Notice 2020-02):

  • Claims for refund;
  • NPA protests;
  • Appeals with the Office of Tax Appeals; and
  • Petitions for rehearing filed with the Office of Tax Appeals.

The FTB will also be given until July 15, 2020, to issue an NPA for any statute of limitations period that expires during the period March 12, 2020, through July 15, 2020.

To see the CDTFA’s notice announcing the extension, go to:

https://cdtfa.ca.gov/news/20-06.htm

To see FTB Notice 2020-02 go to:

www.ftb.ca.gov/tax-pros/law/ftb-notices/2020-02.pdf