States offer tax filing relief in wake of COVID-19 outbreak

As the impact of the coronavirus (COVID-19) continues to spread across the country, different states’ departments of revenue are offering various forms of tax relief, from extending tax filing deadlines to deferring sales tax. Legislative activity is moving quickly and changing daily. As of March 23, 2020, 39 states, along with various municipalities,  have issued some level of tax relief, such as extending the filing and tax payment deadlines.

The federal government has extended the April 15 tax filing deadline to July 15. Some states, such as Georgia, are following this guidance, and others are setting their own deadlines for state taxes.

For instance, in South Carolina, deadlines have been extended for withholding tax, individual income taxes, corporate income taxes, sales and use tax and admissions tax. Tax returns and payments due April 1, 2020, through May 31, 2020, are now due by June 1, 2020. Penalties and interest will not be charged if returns and payments are submitted by June 1, 2020.

Other states are offering targeted tax relief, as well. The state of Alabama is waiving late payment penalties for any small retail or restaurant business that had monthly retail sales during the prior calendar year averaging $62,500 or less and is unable to timely pay its February, March and April 2020 state sales tax liabilities. Those penalties will be waived through June 1, 2020.

Among its state tax relief efforts, Massachusetts has issued two emergency regulations. These regulations extend the filing and payment deadlines for sales and use tax and the state’s room occupancy excise tax for the March 20, 2020, through May 31, 2020, period until June 20, 2020, for vendors whose sales tax liability in the prior 12 months was less than $150,000.

Activity is moving quickly at both the state and federal levels. The AICPA is updating its website with states’ information as it becomes available. You can find a chart with a listing of states’ filing relief under “Advocacy and tax relief” at this site:

We will continue to stay on top of this ever-changing environment and keep you informed.

This communication is intended to provide general information on legislative COVID-19 relief measures as of the date of this communication and may reference information from reputable sources. Although our firm has made every reasonable effort to ensure that the information provided is accurate, we make no warranties, expressed or implied, on the information provided. As legislative efforts are still ongoing, we expect that there may be additional guidance and clarification from regulators that may modify some of the provisions in this communication. Some of those modifications may be significant. As such, be aware that this is not a comprehensive analysis of the subject matter covered and is not intended to provide specific recommendations to you or your business with respect to the matters addressed.