IRS Extends Deadlines for IRC § 1031 Exchanges, Qualified Opportunity Fund Investments and Additional Taxpayers
In Notice 2020-23
(the “Notice”), the IRS extended certain deadlines for taxpayers currently engaged in IRC § 1031 exchanges or considering an investment in a Qualified Opportunity Fund. In addition, the Notice extends tax deadlines to cover individuals, estates, corporations and others. This extension includes various tax form filings and payment obligations that are due between April 1, 2020 and July 15, 2020, including estimated tax payments due June 15 and the deadline to claim refunds from 2016. The Notice suspends associated interest, additions to tax, and penalties for late filing or late payment until July 15, 2020.
The Notice expands upon the relief provided in Notice 2020-17
, Notice 2020-18
and Notice 2020-20
. The relief provided in the Notice includes extending the following, action, filing and payment deadlines to July 15, 2020:
IRC § 1031 Extension
- The Notice provides that any person performing a time-sensitive action listed in either § 301.7508A-1(c)(1)(iv)-(vi) of the Procedure and Administration Regulations or Revenue Procedure 2018-58, 2018-50 IRB 990, which is due to be performed on or after April 1, 2020, and before July 15, 2020 (a “Specified Time-Sensitive Action”), is an “Affected Taxpayer” for purposes of the Notice.
- Under Revenue Procedure 2018-58, transferors of certain property with respect to IRC § 1031 exchanges are included as taxpayers performing a time-sensitive action. As a result, a taxpayer engaged in an IRC § 1031 exchange who is performing a time-sensitive action due to be performed on or after April 1, 2020, and before July 15, 2020 should be considered an Affected Taxpayer for purposes of the Notice.
- The Notice provides that Affected Taxpayers have until July 15, 2020, to perform all Specified Time Sensitive Actions, that are due to be performed on or after April 1, 2020, and before July 15, 2020.
- Accordingly, an Affected Taxpayer with a 45-Day Exchange Period or 180-Day Exchange Period deadline between April 1 and July 15, 2020 will have an automatic extension to July 15, 2020.
Qualified Opportunity Funds
- For purposes of this Notice, the term Specified Time-Sensitive Action also includes an investment at the election of a taxpayer due to be made during the 180-day period described in IRC § 1400Z-2(a)(1)(A).
Additional Tax Deadlines Extended
- Individual income tax payments and return filings on 1040-NR, U.S. Nonresident Alien Income Tax Return, 1040-NR-EZ, U.S. Income Tax Return for Certain Nonresident Aliens With No Dependents, 1040-PR, Self-Employment Tax Return – Puerto Rico, and 1040-SS, U.S. Self-Employment Tax Return (Including the Additional Child Tax Credit for Bona Fide Residents of Puerto Rico);
- Calendar year or fiscal year corporate income tax payments and return filings on Form 1120, U.S. Corporation Income Tax Return, 1120-C, U.S. Income Tax Return for Cooperative Associations, 1120-F, U.S. Income Tax Return of a Foreign Corporation, 1120-FSC, U.S. Income Tax Return of a Foreign Sales Corporation, 1120-H, U.S. Income Tax Return for Homeowners Associations, 1120-L, U.S. Life Insurance Company Income Tax Return, 1120-ND, Return for Nuclear Decommissioning Funds and Certain Related Persons, 1120-PC, U.S. Property and Casualty Insurance Company Income Tax Return, 1120-POL, U.S. Income Tax Return for Certain Political Organizations, 1120-REIT, U.S. Income Tax Return for Real Estate Investment Trusts, 1120-RIC, U.S. Income Tax Return for Regulated Investment Companies, 1120-S, U.S. Income Tax Return for an S Corporation, and 1120-SF, U.S. Income Tax Return for Settlement Funds (Under IRC § 468B);
- Calendar year or fiscal year partnership return filings on Form 1065, U.S. Return of Partnership Income, and Form 1066, U.S. Real Estate Mortgage Investment Conduit (REMIC) Income Tax Return;
- Estate and trust income tax payments and return filings on Form 1041, U.S. Income Tax Return for Estates and Trusts, 1041-N, U.S. Income Tax Return for Electing Alaska Native Settlement Trusts, and 1041-QFT, U.S. Income Tax Return for Qualified Funeral Trusts;
- Estate and generation-skipping transfer tax payments and return filings on Form 706, United States Estate (and Generation-Skipping Transfer) Tax Return, 706-NA, United States Estate (and Generation-Skipping Transfer) Tax Return, 706-A, United States Additional Estate Tax Return, 706-QDT, U.S. Estate Tax Return for Qualified Domestic Trusts, 706-GS(T), Generation-Skipping Transfer Tax Return for Terminations, 706-GS(D), Generation-Skipping Transfer Tax Return for Distributions, and 706-GS(D-1), Notification of Distribution from a Generation-Skipping Trust (including the due date for providing such form to a beneficiary);
- Form 706, United States Estate (and Generation-Skipping Transfer) Tax Return filed pursuant to Revenue Procedure 2017-34;
- Form 8971, Information Regarding Beneficiaries Acquiring Property from a Decedent and any supplemental Form 8971, including all requirements contained in IRC § 6035(a);
- Gift and generation-skipping transfer tax payments and return filings on Form 709, United States Gift (and Generation-Skipping Transfer) Tax Return that are due on the date an estate is required to file Form 706 or Form 706-NA;
- Estate tax payments of principal or interest due as a result of an election made under IRC § 6166, IRC § 6161, or IRC § 6163 and annual recertification requirements under IRC § 6166;
- Exempt organization business income tax and other payments and return filings on Form 990-T, Exempt Organization Business Income Tax Return (and proxy tax under IRC § 6033(e));
- Excise tax payments on investment income and return filings on Form 990-PF, Return of Private Foundation or IRC § 4947(a)(1) Trust Treated as Private Foundation, and excise tax payments and return filings on Form 4720, Return of Certain Excise Taxes under Chapters 41 and 42 of the IRC; and
- Quarterly estimated income tax payments calculated on or submitted with Form 990-W, Estimated Tax on Unrelated Business Taxable Income for Tax-Exempt Organizations, 1040-ES, Estimated Tax for Individuals, 1040-ES (NR), U.S. Estimated Tax for Nonresident Alien Individuals, 1040-ES (PR), Estimated Federal Tax on Self Employment Income and on Household Employees (Residents of Puerto Rico), 1041-ES, Estimated Income Tax for Estates and Trusts, and 1120-W, Estimated Tax for Corporations.
This Notice provides that relief is automatic and does not require taxpayers to contact the IRS or file any extension forms, or send letters or other documents to receive this relief.
The relief the Notice provides includes extending the time for filing all petitions with the Tax Court, or for review of a decision rendered by the Tax Court, filing a claim for credit or refund of any tax, and bringing suit upon a claim for credit or refund of any tax. However, the Notice does not provide relief for the time period for filing a petition with the Tax Court, or for filing a claim or bringing a suit for credit or refund if that period expired before April 1, 2020.
The Notice also suspends associated interest, additions to tax, and penalties for late filing or late payment until July 15, 2020.