This is tax season #41 for me and is unlike any other tax season in history. In our lifetime, we haven’t faced a pandemic as extensive as COVID-19.
Since 1986, CPAs have worked at over 100% of capacity to prepare complete and accurate tax returns for our clients or to compute estimates of tax liability for filing extensions. There is no excess capacity.
Then, COVID-19 interrupted our efficient processes and the normal way we conduct business. Working from home may not be ideal or productive for some of us. Many of us have multiple computer monitors at the office, but not at home. If we’re working from home, we may be struggling with childcare since schools and daycares are closed. Spouses may be healthcare professionals or other essential workers, who cannot share the load because of their vital role in the community. We may be caring for elderly parents and friends who have a much higher health risk. We may ourselves be in a high-risk category.
Some of us may be struggling with working remotely with our staff, getting clients to use client portals, reducing face-to-face interactions, accessing resources and vendors and countless other unforeseen challenges that we did not have time to prepare for properly.
For all these reasons, our tax community was in jeopardy of sustaining our normal business operations. Many of us were straining from the pressure of having to get client’s tax returns filed on time.
The AICPA heard the call of its members to delay the tax return due date. We advocated to the IRS and Treasury to give us more time to file. Initially, Treasury Secretary Mnuchin extended the date for payment of taxes but was adamant that the filing date remain April 15. That created additional confusion; the public viewed the change as an extension of “tax day.”
Delaying the payment of taxes wasn’t enough help for CPAs. Certain tasks still need to be performed by the taxpayer by the original due date (such as making IRA contributions). Tax preparers and taxpayers were not relieved of the administrative burden of complying with extension filing requirements.
Because of the unprecedented disruption in daily routine, the AICPA Tax Policy & Advocacy team again jumped into action. Overnight, we drafted and sent a comment letter supporting Senator Thune’s short legislation extending the due date for 2019 returns to the 15th day of the seven month after the end of the tax year. This was included in the original version of the Senate’s Coronavirus Aid, Relief and Economic Security (CARES) legislation.
AICPA members emailed their senators and representatives (and Secretary Mnuchin) encouraging a delay in the due date for filing 2019 income tax returns. And within two days, Secretary Mnuchin tweeted that the filing date would be moved to July 15. A day later, on March 20, the IRS released Notice 2020-18 confirming the extension of the tax filing deadline. The provision was removed from the CARES Act as mostly moot. Then, at the end of last week, Notice 2020-20 extended the gift and generation-skipping transfer tax filing and payment deadlines as well.
It’s this passion and strength from our tax community that created a movement for the benefit of our profession. When we work together, we can do great things.
There’s still more work to be done. For tax practitioners, it’s to continue forging ahead to get through a tax season. For the AICPA, it’s to continue stressing the importance of the Treasury and the IRS to provide extensive relief during these challenging and unprecedented times. Taxpayers and their advisers need processes, considerations and answers now based on fairness, simplification and good tax administration.
Stay safe and stay healthy. Do what we can. Focus on the tasks we can accomplish now. Keep with the latest tax updates through the AICPA Coronavirus Tax Resource Center and Tax Season Resources Hub. Provide the trusted client service for which CPAs are known. We’ll get through this, together.
Chris Hesse is the Chair of the AICPA Tax Executive Committee, which has the authority to speak on behalf of the AICPA in tax matters. He is a principal with the National Tax Office of CLA (CliftonLarsonAllen LLP).