Yesterday afternoon the Oregon Department of Revenue issued its much anticipated guidance providing income tax relief due to the COVID-19 pandemic. We now have the final information necessary to fully evaluate the tax relief available for both federal and Oregon income tax purposes in the context of the April 15, 2020 filing deadline. Here’s what we know:

Federal Income Tax Relief

  1. Any income tax return normally due on April 15, 2020 will now be due on July 15, 2020. This includes all individual and corporate income tax returns. No extension or other form is necessary to take advantage of this later filing due date.
  2. A further extension of time will be available upon request until October 15, 2020 for those not able to meet the July 15th deadline.
  3. Payment of any 2019 income tax otherwise due on April 15th will now be due on July 15th. This includes payments for self-employment tax.
  4. The extension to pay the tax due until July 15th applies even if you file your return before then.
  5. This relief applies to income tax returns only and not to any other tax return or tax payment that might be due.
  6. Any contributions to individual retirement accounts (IRAs) for the 2019 tax year can now be made through July 15th.
  7. Any first quarter 2020 federal estimated tax payment that would otherwise be due on April 15th can be deferred until July 15th without penalty or interest.
  8. There is no change to the second quarter 2020 federal estimated tax payment due date. Second quarter estimated tax payments are due by June 15th as usual.

Oregon Income Tax Relief

  1. Oregon will generally follow the federal guidelines with one notable exception. Oregon will require 2020 first quarter estimated tax payments to be made on April 15, 2020. Failure to pay estimated taxes when due may result in interest being charged from the due date of the payment until the date paid. The interest rate currently used is 6%.
  2. Corporations whose Oregon return would otherwise be due on May 15th will also qualify for the filing extension to July 15, 2020.
  3. Any transit tax return due April 15, 2020 (e.g. Lane Transit District Self-Employment Tax) will now be due July 15, 2020.
  4. The relief does not apply to any Oregon Commercial Activity Tax (CAT) payments that might be due on April 30, 2020. However, the Department of Revenue has indicated that it will not assess underpayment penalties for taxpayers making a good-faith effort to estimate their first quarter CAT payments.

It should also be noted that California and many other states have adopted similar relief.

If you have questions on how these relief provisions might affect your personal tax situation, please feel free to contact us.