The Trump administration is planning on delaying the April 15 tax filing deadline for individuals and small businesses to soften COVID-19-related financial blows to the US economy, US Treasury Secretary Steven Mnuchin announced Wednesday.
According to Mnuchin, the tax delay would be applicable to “to virtually all Americans, other than the super rich,” the Wall Street Journal reported.
“For small- and medium-sized businesses, for hardworking individuals, we are going to recommend to the president that we allow the delay and that they don’t have to pay an interest or penalty on that. That will have the impact of putting over $200 billion back into the economy, and that will create a very big stimulus,” Mnuchin added.
Munuchin also told lawmakers Wednesday that the delay doesn’t require congressional approval.
“This we can do on an administrative basis,” he said. However, it is unclear how long the extension would be. Taxpayers can usually request a six-month filing extension after the mid-April deadline.
According to people familiar with the matter, Treasury officials are currently debating how long the deadline should be extended and who would qualify for an extension, the Journal reported.
However, extending the deadline could impact the federal budget and borrowing. Extending the deadline might result in the Treasury having to borrow money to make up for the delay in revenue from federal tax payments. However, Mnuchin suggested that the department could issue additional Treasury bills to offset the revenue delay.
House Democrats on Tuesday asked the Internal Revenue Service (IRS) whether the April 15 deadline should be pushed back.
Last week, US President Donald Trump introduced several policy options that the administration is considering in an effort to mitigate the effects of the coronavirus on the US economy, including a payroll tax cut, permitting paid sick leave for employees and providing emergency lending to small businesses.
The IRS also said last week that it was monitoring the outbreak but noted that “normal IRS operations are continuing, and we are seeing a strong, smooth filing season for the nation.”
“Taxpayers should continue to file and submit tax returns as they normally would,” the IRS statement added.
The latest data from Johns Hopkins University reveals that more than 1,000 cases of the coronavirus have been confirmed in the US, and that at least 30 deaths have occurred in the country as a result of the disease.
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