Feds approve delaying tax payments
Plan designed to inject $300B into economy
WASHINGTON — The Trump administration said individuals and businesses will be allowed to delay paying their 2019 tax bills for 90 days past the usual April 15 deadline. The extension announced Tuesday is an effort to inject up to $300 billion into the economy at a time when the coronavirus appears on the verge of causing a recession.
Treasury Secretary Steven Mnuchin said individuals will be able to delay making up to $1 million in payments. Corporations will be able to defer payments on up to $10 million.
Taxpayers will still have to file their tax returns by the April 15 deadline. But they won’t have to pay their tax bill for 90 additional days. During that time, individuals and corporations will not be subject to interest or penalty payments.
“All you have to do is file your taxes,” Mnuchin said.
The Treasury secretary said President Donald Trump had approved the final details of the program, including its expansion to include the potential of allowing taxpayers to keep $300 billion in the economy for now. Last week, Mnuchin had estimated that deferred payments would amount to $200 billion.
Mnuchin had said the delay would apply to all but the “super rich” but did not spell out how the payment delay will work. The IRS has yet to release specific guidelines for the program.
The IRS is using authority under Trump’s national emergency declaration to take the step of approving the 90-day payment delay. Mnuchin encouraged taxpayers to keep filing their returns because many of them will be receiving refunds that they will be able to use to pay bills during the economic downturn.
As of Feb. 21, the IRS had issued more than 37.4 million refunds averaging $3,125.
Meanwhile, Trump asked Congress on Tuesday to speed emergency checks to Americans, enlisted the military for Mash-like hospitals and implored ordinary people — particularly socially active millennials — to do their part by staying home to stop the spread of the virus.
His proposed economic package alone could approach $1 trillion, a rescue initiative not seen since the Great Recession.
At the Capitol, Senate Majority Leader Mitch Mcconnell, R-KY., vowed the Senate would not adjourn until the work was done.
“Obviously, we need to act,” Mcconnell said. “We’re not leaving town until we have constructed and passed another bill.”
But first, Mcconnell said, the
Senate will vote on the House’s $100 billion package of sick pay, emergency food and free testing, putting it back on track for Trump’s signature — despite Republican objections.
”Gag, and vote for it anyway,” he advised colleagues.