California COVID-19 Tax Relief

By Steffi Gascón Hafen

In response to the COVID-19 pandemic, on March 18, 2020, the Franchise Tax Board of California (FTB) issued various tax file and pay deadline extensions to July 15, 2020, for taxpayers affected by the pandemic.  Any taxpayer with a California income tax return filing or payment due date between March 15, 2020 and July 15, 2020 (whether calendar or fiscal year filer) is considered “affected” and gains the automatic protections afforded by the special tax relief without any other showing of proof.  Interest and any late filing or late payment penalties that would otherwise apply to affected persons during the relief period are also waived per the FTB’s March 13, 2020 announcement.

For more information on the Federal tax relief, please see the Legal Alerts addressing the extension of time to pay and time to file Federal income tax returns.  This Legal Alert only covers California relief. 

This new California tax relief extension to July 15, 2020 was issued on March 18, 2020, and supersedes California’s prior tax relief announcement on March 13, 2020, which extended deadlines to June 15, 2020.  

2019 Tax Returns and Payments.  Any taxpayer with a California income tax return filing or payment due date between March 15, 2020 and July 15, 2020 (whether calendar or fiscal year filer) is granted an automatic extension to file 2019 California tax returns and make payments until July 15, 2020.  This includes individuals, business entities (including Corporations, S Corporations, LLCs, Partnerships and other entities), estates and trusts, and tax-exempt organizations. 

2020 Estimated Quarterly Taxes Due Date.  The first quarter estimated tax payment due date for individuals, C corporations, S corporations and Tax-Exempt organizations has been extended to July 15, 2020.  The second quarter due date is also July 15, 2020.  The third quarter due date is not yet available.  The fourth quarter due date is January 15, 2020.

2020 LLC Taxes and Fees.   LLC taxes and fees due between March 15, 2020 and July 15, 2020 are extended to July 15, 2020.

2020 Non-Wage Withholding Payments.  Non-wage withholding due between March 15, 2020 and July 15, 2020 is extended to July 15, 2020.

What Doesn’t Apply.  Any taxpayer with a California tax return filing or payment due date prior to March 15, 2020, including 2019 estimated quarterly taxes, is not included in this emergency tax relief.  Interest and penalties should continue to accrue on such late filings or payments not covered by the relief. 

Taxpayers are urged to continue filing returns on time where possible, so taxpayers can receive refunds in a timely manner, including the Earned Income Tax Credit and Young Child Tax Credit.  The FTB continues to process tax returns, issue refunds and provide phone and live chat services to taxpayers at this time.

Guidance in response to the COVID-19 pandemic is constantly being updated.  This article is merely intended to introduce you to recent FTB publications and is not a substitute for careful tax planning.  If you have any questions, you are strongly encouraged to reach out to your tax advisor.