The coronavirus pandemic has forced people around the world to make dramatic changes to their everyday lives, and Americans should be aware of some Covid-19 tax changes that will likely impact how and when they file their taxes for the 2019 tax year.
In late March of 2020, Congress and the president passed a massive stimulus bill designed to help the economy during a time when the majority of the nation’s population was told to stay home, and millions of people found their jobs on pause.
The federal government made immediate changes to the tax code, too, in light of the Covid-19 pandemic. One of the most dramatic changes was that the Internal Revenue Service (IRS) changed its filing deadline from the traditional April 15 to July 15.
Forbes reveals that on March 19:
“Senator John Thune introduced a two-page bill “Tax Filing Relief for America Act” “To extend the due date for the return and payment of Federal income taxes to July 15, 2020, for taxable year 2019.”
In addition to the filing change at the federal level, states have also changed their filing dates. For Illinois residents, USA Today shares:
“Illinois Gov. J.B. Pritzker announced he’s delaying the tax filing deadline to July 15.”
It’s important for every taxpayer to check the official IRS website for updates to 2019 tax return requirements, as well as to check the state pages for additional information. Some taxpayers may also need to check with their local government if they’re required to submit tax payments to their cities each year.
The Economic Impact Payment
Another change was the economic impact payment planned for most Americans. On the payment, the IRS shares:
“Tax filers with adjusted gross income up to $75,000 for individuals and up to $150,000 for married couples filing joint returns will receive the full payment. For filers with income above those amounts, the payment amount is reduced by $5 for each $100 above the $75,000/$150,000 thresholds. Single filers with income exceeding $99,000 and $198,000 for joint filers with no children are not eligible.
Eligible taxpayers who filed tax returns for either 2019 or 2018 will automatically receive an economic impact payment of up to $1,200 for individuals or $2,400 for married couples. Parents also receive $500 for each qualifying child.”
The IRS plans on sending taxpayers their stimulus checks by direct deposit, so taxpayers who haven’t set up direct deposit with the IRS may need to take an additional step to secure their check.
Tax and Economic Relief Around the World
The United States isn’t the only place where governments have made the decision to postpone taxes, change them, or offer stimulus checks to its inhabitants. According to The Tax Foundation, Greece has postponed some tax payments for businesses, Indonesia has extended one of its tax deadlines, and Israel has extended its deadline for online income tax filings.
Further, Latvia has created a tax relief program for businesses impacted by reduced revenues due to the Covid-19 pandemic New Zealand has eliminated some fines and penalties, and Romania has delayed many of its tax deadlines for a month.
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