Earning

Tax day has been moved to July — here's what you need to know

Twenty/20

You'll now have an extra 90 days, until July 15, to file and pay your federal income taxes.

You are still allowed to file for an extension until October 15, just as you can during any other year. To do that, you have to file the extension form by April 15.

The changes have rolled out over the course of the week. The White House first announced changes on Tuesday. Then Treasury Secretary Steven Mnuchin said on CNBC Wednesday that the IRS would not be extending the April 15 filing deadline but would allow filers extra time to pay. Finally, Mnuchin announced via Twitter on Friday that the deadline to both file and pay taxes will be July 15.

He added, in a subsequent tweet, "I encourage all taxpayers who may have tax refunds to file now to get your money."

The delay is a rare but not unprecedented move by the IRS. Some regions affected by a 2007 nor'easter were allowed to pay their taxes as late as June of that year.

Mnuchin estimates the delay will free up $300 billion to help individuals and businesses that might otherwise have trouble with cash flow issues brought about by the economic impact of the coronavirus.

Here's what to keep in mind as you figure out how and when you should file your taxes.

It's still smart to file ASAP

If you don't owe money to the IRS and are expecting a refund, then you still have an incentive to file your taxes as soon as possible.

"We encourage those Americans who can file their taxes to continue to file their taxes on April 15," Mnuchin announced at a press conference on Tuesday. "Because for many Americans, you will get tax refunds."

The average refund, as of March 6, is $3,012, according to the IRS. That kind of money can help pad or start your emergency fund.

Already, 18% of nonretired American workers had lost their jobs or had their hours reduced because of coronavirus-related disruptions, according to a survey released Tuesday by NPR, PBS NewsHour, and Marist. An emergency fund is the first place experts suggest you turn for cash.

If it turns out you owe the IRS money, filing early can also give you more time to get the funds together.

This change is particularly "beneficial ... for those who know they owe and still have not set aside enough cash flow to pay that tax bill by what would have been the original due date of April 15," says Lazetta Rainey-Braxton, co-CEO of New York-based financial planning firm 2050 Wealth Partners. 

VIDEO3:1603:16
How to pay taxes as a freelancer

Video by David Fang

Don't assume the delay applies to your state return

Mnuchin's announcement only applies to your federal return, which means you should check to see if your state returns are still due when they would normally be. Multiple states, but not all, had pushed back their deadlines as of Friday. 

California has extended filing and payment deadlines to July 15 for businesses and individuals, while Colorado, Connecticut, Indiana, Maryland, Michigan, and Ohio previously agreed to align their deadlines with any delay announced by the IRS.

As the coronavirus continues to upend daily life, additional states may make changes. For up-to-date information, check the State Tax Filing Guidance Chart from the American Institute of Certified Public Accountants. It tracks every state's deadlines and coronavirus-related relief provisions and updates them frequently online.

VIDEO3:1303:13
Where your federal taxes are spent

Video by David Fang

If you want to file closer to July or get an extension

Many accountants and tax prep firms depend on temporary workers to prepare the glut of tax returns that come in during March and April. If you're filing after April, it's important to remember that it may be harder to get help: Firms may not have enough workers, or your CPA may not have enough bandwidth, to do returns. 

"You better make sure that they want to work till July because most of them, they are exhausted from a very intense tax season from January to April," says Braxton. "They have to manage the capacity for being able to hire because they may have seasonal employees as well." 

That said, you may have options. H&R Block, for example, released an online guide to the delay, noting that they "will be standing ready to help — no matter how you choose to file" during the extension period. 

More from Grow: 

acorns+cnbcacorns cnbc

Join Acorns

GET STARTED

About Us

Learn More

Follow Us

All investments involve risk, including loss of principal. The contents presented herein are provided for general investment education and informational purposes only and do not constitute an offer to sell or a solicitation to buy any specific securities or engage in any particular investment strategy. Acorns is not engaged in rendering any tax, legal, or accounting advice. Please consult with a qualified professional for this type of advice.

Any references to past performance, regarding financial markets or otherwise, do not indicate or guarantee future results. Forward-looking statements, including without limitations investment outcomes and projections, are hypothetical and educational in nature. The results of any hypothetical projections can and may differ from actual investment results had the strategies been deployed in actual securities accounts. It is not possible to invest directly in an index.

Advisory services offered by Acorns Advisers, LLC (“Acorns Advisers”), an investment adviser registered with the U.S. Securities and Exchange Commission (“SEC”). Brokerage and custody services are provided to clients of Acorns Advisers by Acorns Securities, LLC (“Acorns Securities”), a broker-dealer registered with the SEC and a member of the Financial Industry Regulatory Authority, Inc. (“FINRA”) and the Securities Investor Protection Corporation (“SIPC”). Acorns Pay, LLC (“Acorns Pay”) manages Acorns’s demand deposit and other banking products in partnership with Lincoln Savings Bank, a bank chartered under the laws of Iowa and member FDIC. Acorns Advisers, Acorns Securities, and Acorns Pay are subsidiaries of Acorns Grow Incorporated (collectively “Acorns”). “Acorns,” the Acorns logo and “Invest the Change” are registered trademarks of Acorns Grow Incorporated. Copyright © 2019 Acorns and/or its affiliates.

NBCUniversal and Comcast Ventures are investors in Acorns Grow Incorporated.