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COVID-19 for Individuals and the Self-Employed

March 25, 2020 Author: Joe Paulson, CPA, Partner, Compass Pointe CPAs

Compass Pointe CPAs Greenwood Indianapolis Indiana

Treasury Secretary Steven Mnuchin announced on Friday, March 20, 2020 that tax returns normally due on April 15 will not be due until July 15 this year.

Notice 2020-17 announced that it was pushing back the deadline for federal tax payments (up to $1 million for individuals and up to $10 million for corporations) that were due on April 15 to July 15. The taxpayer’s filing status, ie. single, married filing jointly, does not matter in this case. The $1 million threshold also applies to trusts and estates.

This extension is automatic, meaning taxpayers may delay filing and paying their federal income tax up to 90 days and the IRS will not assess penalties or interest on payments made during the 90-day deferral period.

Estimated federal tax payments due on April 15, 2020 also qualify for the 90-day extension.

As many of our clients file in Indiana, Indiana has followed the IRS guidelines on both filing and payment of Indiana income taxes. For a comprehensive list that is updated by the AICPA for each state, please visit here:

Coronavirus State Filing Relief

Credits for Sick and Family Leave for Certain Self-Employed Individuals

Self-employed workers, including independent contractors, can claim a credit against their regular income taxes related to sick or family leave. The credit covers 100% of self-employed individuals’ self-employment income or 67% if an individual is taking care of a child whose school is closed. The per-day amount is limited to the lesser of the individual’s average daily self-employment income, or $511 per day if caring for themselves or $200 if caring for a minor child. The number of eligible days is limited to 10 if related to sick leave and 50 if related to family leave. The IRS is to provide guidance as to what documentation self-employed individuals must submit to claim the credit.

Please reach out to your tax advisor for guidance on these unprecedented changes. 

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