Americans anxious about getting their taxes done on time this year got a slight reprieve Wednesday, as the Internal Revenue Service announced it’s pushing back the filing deadline by more than a month.
Instead of the customary April 15 cutoff, taxpayers will now have until May 17 to submit their 1040 forms, IRS Commissioner Chuck Rettig said, citing the hardships of the COVID-19 pandemic.
“This continues to be a tough time for many people, and the IRS wants to continue to do everything possible to help taxpayers navigate the unusual circumstances related to the pandemic,” Rettig said in a statement. “Even with the new deadline, we urge taxpayers to consider filing as soon as possible, especially those who are owed refunds.”
Massachusetts Rep. Richard Neal, the Democratic chairman of the taxation-focused House Ways and Means Committee, lauded Rettig’s announcement.
“This extension is absolutely necessary to give Americans some needed flexibility in a time of unprecedented crisis,” Neal said in a joint statement with New Jersey Rep. Bill Pascrell, the top Democrat on the committee’s oversight sub-panel. “Under titanic stress and strain, American taxpayers and tax preparers must have more time to file tax returns.”
The IRS is already behind on processing millions of 2019 tax returns because last year’s filing deadline was extended until July.
In addition, this year’s tax season didn’t start until Feb. 12 — more than a month late — to let the IRS focus on implementing the $908 billion coronavirus relief bill that was signed into law in late 2020 to stave off the economic damage dealt by the still-raging pandemic.
Since then, President Biden has signed the $1.9 trillion American Rescue Plan into law.
Biden’s rescue bill is likely to keep the IRS busy for weeks, as the agency prioritizes the processing of stimulus checks and other pandemic aid bankrolled by the massive legislation.
The Treasury Department said Wednesday that the IRS has already sent out more than 90 million stimulus checks, totaling more than $242 billion, since Biden inked the stimulus package last Thursday. Biden vowed last week that the government would roll out at least 100 million checks within 10 days of the legislation’s enactment, a goal he appeared likely to meet.
Individuals earning less than $75,000 per year are getting $1,400 checks and couples earning less than $150,000 are getting $2,800 checks — a category of earners that jointly make up the majority of U.S. taxpayers.
Considering the tax return backlog from last year and the urgency of stimulus spending, Neal and Pascrell suggested IRS may have to delay the tax filing deadline even beyond May 17.
“We are gratified that the IRS has recognized the need and heeded our calls for additional time, and while we are pleased with this 30-day extension, we will continue to monitor developments during this hectic filing season,” they said.
Beyond the logistical complications of pumping out stimulus cash, the American Rescue Plan tweaked some taxation rules that are requiring the IRS’ attention.
With millions of Americans still unemployed because of the job-killing pandemic, Democrats folded language into the relief legislation to make the first $10,200 earned in jobless benefits tax-free.
It remains unclear exactly how unemployed workers will be able to claim that benefit if they paid taxes on their jobless aid last year, but the IRS has promised to issue guidance on the retroactive provision.
