Deadline for Contributions to IRAs and Roth IRAs Extended
The IRS on March 29 in Notice 2021-21 announced that it is delaying the deadline by which 2020 contributions to IRAs and Roth IRAs must be made until May 17, 2021.
The IRS took the action in light of the March 13, 2020 emergency declaration issued by President Trump that said the COVID-19 pandemic was of sufficient severity and magnitude to warrant an emergency determination under the Robert T. Stafford Disaster Relief and Emergency Assistance Act, 42 U.S.C. 5121· 5207.
The IRS says that the deadline was automatically postposed to May 17, 2021, as the deadline for filing Form 1040 has been extended to that date. The extended contribution deadline also applies to contributions to health savings accounts (HSAs), Archer Medical Savings Accounts (Archer MSAs), and Coverdell education savings accounts (Coverdell ESAs).
The postponement also automatically postpones to May 17, 2021, the time for reporting and paying the 10% additional tax on amounts includible in gross income from 2020 distributions from IRAs or workplace-based retirement plans.
Notice 2021-21 also says that the date by which the Form 5498 series must be filed with the IRS and furnished to participants and beneficiaries is postponed to June 30, 2021. In addition, the IRS says it will disregard the period beginning on the original due date of those forms and ending on June 30, 2021, regarding the calculation of any penalty for failure to file those forms.
The relief concerning the filing of federal income tax returns and paying federal income taxes applies only to the Form 1040 series returns having an original due date of April 15, 2021, and the Form 5498 series returns as described above.
In addition, the IRS says that this relief does not apply to businesses and any other type of taxpayer that files federal income tax returns on forms outside of the Form 1040 series; it does not consider them to be affected taxpayers to whom this relief applies.
The IRS also says that there is no extension for the payment or deposit of any other type of federal tax, including estimated income tax payments, nor for the filing of any federal return other than the Form 1040 series and the Form 5498 series for the 2020 taxable year.
Questions about what this new deadline means for you? Contact the Robin S. Weingast & Associates Team – we're here to help!