Across the United States, the COVID-19 pandemic has created an unusual situation in the sales tax world. State offices are closed indefinitely, causing confusion for many taxpayers. Luckily, many states have issued extensions for sales tax filings and payments. Penalties for late filing and interest are waived. Refer to the state by state analysis to see which states have extended deadlines for filing returns and payments or waived penalties for late filing and interest.
New York’s Sales Tax Response to COVID-19
New York has issued executive order N-20-1 providing relief to quarterly and annual filers scheduled to file returns March 20, 2020. Any business that qualifies for the extension will have an added 60 days from the original due date to file and pay returns without paying late filing penalties and interest. In order to qualify, certain criteria must be met (N-20-1). See below for examples of those who qualify:
- taxpayers who were unable to meet tax filing, payment, or other deadlines because key employees were treated or suspected to have COVID-19;
- taxpayers whose records necessary to meet tax filing, payment, or other deadlines are not available due to the outbreak;
- taxpayers who have difficulty in meeting tax filing, payment, or other deadlines because of closure orders or similar business disruptions directly resulting from the outbreak; and
- taxpayers whose tax practitioners were unable to complete work to meet tax filing, payment, and other deadlines on behalf of their clients due to the outbreak.
*Note: Monthly filers and Promptax program participants are not eligible for relief.
To request relief for the filing extension, visit https://www.tax.ny.gov/ and click on tax relief for quarterly and annual filers sales tax vendors affected by COVID-19. The instructions for requesting relief are listed here. Each taxpayer will be notified through the online system if their request has been granted.
California’s Sales Tax Response to COVID-19
California Executive order NR 20-06 is providing a three-month extension for sales tax returns filing less than $1 million in tax for quarter one 2020. Original returns due April 30, 2020, are now due July 31, 2020, for qualified businesses. Qualified taxpayers do not need to request relief from the department, the extension is automatic. Also, vendors requesting refund claims or seeking an appeal during this period will have an additional 60 days to file. On April 2, the state has announced it is allowing small businesses to defer payment of sales and use taxes of up to $50,000, for up to 12 months.
Connecticut’s Sales Tax Response to COVID-19
The Governor of Connecticut is granting a two-month extension for small businesses in recognition of COVID-19. Unlike New York, taxpayers with lower than $150,000 in annual sales tax liability in 2019 automatically qualify for the relief.
- For monthly filers: Returns originally due March 31, 2020 and April 30, 2020 are extended to May 31, 2020
- For Quarterly Filers: Returns originally due April 30, 2020 are extended to May, 31st, 2020.
“Taxpayers who file and pay on or before the extended deadlines will not be subject to any penalties or interest” (Governor Lamont COVID-19 update).
Washington’s Sales Tax Response to COVID-19
Washington’s business relief during COVID-19 will cover the undisclosed amount of time that the state of emergency lasts. Filing extensions are as follows:
- Monthly filers: Request an extension for paying tax returns prior to the due date (or within 4 days after the due date) by sending a secure email in your My DOR account or by calling Revenue’s customer service at 360-705-6705, Monday through Friday 8 a.m. to 5 p.m.
- If you miss the deadline for requesting an extension, request a penalty waiver when filing your return along with an explanation of how COVID-19 Pandemic caused the delay
- Quarterly filers: The Quarter 1, 2020 return is now due June 30, 2020.
- Annual filers: The Annual 2019 return is now due June 15, 2020
The department advises that extensions prolong the due date, but do not waive any tax owed. If a payment has already been scheduled, it must be cancelled in MY DOR account before it has been processed. Prior payment plans can request an additional 30 to 60 days to be extended. If approved, additional penalties will be waived. Washington offers a remote call center 360-705-6705, Monday through Friday.
Be advised, the situation with COVID-19 is fluid and many states are policies are changing weekly. Stay up to date by using our state by state analysis Chart, which will have regular updates on the sales tax laws governing each state during this pandemic.