On June 11 the Department issued guidance to taxpayers about the payments that need to be made just a few days from now. In Notice N-20-8, the Department announced that, there is, indeed, an estimated tax payment still due on Monday, June 15. And for good measure, the Department clarified that taxpayers should treat the June 15 payment as their first installment payment, and the estimated payment due on July 15 (originally due on April 15) as their second installment payment. The approach makes sense, and when we looked at how things were playing out in late March we assumed this was the approach the Department would take. The Department’s better-late-than-never guidance is nonetheless welcome.
The Department also reminded everyone, again just two business days before the due date, that “[p]enalties with respect to the underpayment of estimated tax for individuals and fiduciaries will be calculated based on these revised dates.”
Based on this notice, taxpayers are expected to pay in 25% of their expected 2020 tax liability on June 15 or face penalties for failing to do so. Enjoy the weekend!
