IRS sets May 17 as 2021 tax-filing deadline

The Internal Revenue Service will delay the April 15 tax-filing deadline for the 2021 season until mid-May, the U.S. Treasury and Internal Revenue Service confirmed late Wednesday.

Update 2:48 p.m. ET March 18: In a joint statement, the Treasury and IRS confirmed that the federal income tax filing deadline for individuals for the 2020 tax year will be automatically extended from April 15 to May 17.

“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, while also working on important tax administration responsibilities,” IRS Commissioner Chuck Rettig stated.

“Even with the new deadline, we urge taxpayers to consider filing as soon as possible, especially those who are owed refunds. Filing electronically with direct deposit is the quickest way to get refunds, and it can help some taxpayers more quickly receive any remaining stimulus payments they may be entitled to,” he added.

In addition, individual taxpayers will be allowed to postpone federal income tax payments for the 2020 tax year until May 17, without incurring penalties or interest, regardless of the amount owed, and the postponement allowance includes individuals who pay self-employment tax.

In turn, penalties, individual taxpayers who pay their taxes owed in full by May 17 will avoid interest and penalties, slated to begin accruing on “any remaining unpaid balances as of May 17, 2021,” according to the news release.

Original report: A congressional aide briefed on the decision confirmed the development to The Wall Street Journal, noting the start of the tax-filing season was delayed and has been complicated for taxpayers by pandemic-related confusion and changes to the tax law.

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In particular, a retroactive exemption for up to $10,200 in unemployment benefits has caused tremendous confusion among taxpayers and preparers, the Journal reported.

Bloomberg News first reported the roughly one-month delay, citing three people familiar with the discussions who declined to cite a specific new deadline.

Two of Bloomberg’s sources, neither of which were authorized to speak publicly because the decision has not been finalized, said that the agency is considering setting the filing deadline for either May 15 or Mary 17, but the former falls on a Saturday, and the “IRS typically delays filing deadlines that fall on a weekend or holiday to the next business day.”

The 2021 filing delay comes as the IRS grapples with a massive backlog of roughly 24 million tax filings dating to the 2019 tax year, The Washington Post reported.

According to the outlet, Ken Corbin, the commissioner of the wage and investment division at the IRS, said on Wednesday that the backlog reflects the “many, many challenges” the country and agency have faced as a result of the coronavirus pandemic and repeated inclement weather disasters slowing operations.

“The IRS will always have returns in processing,” Corbin told the Post.