IRS Needs to Delay March 1 Filing Deadline

As we indicated in yesterday’s post, many farmers try to file and pay 100% of their income tax by March 1 each year. For most years, this can be a straight-forward process, but this year is not one of those years.

The IRS initiated a new Form 7203 to track the income tax basis in S corporations. This form is required to be attached to the Form 1040 that a farmer is trying to file by March 1. Our tax software company has indicated that this Form will not be eligible for e-filing at all this tax season.

There is a good chance that the software will automatically attach it as a PDF attachment so we can E File the return but that will not happen until after March 1. Also, many states are still not set up to accept E File returns because the delays by the IRS in approving the forms.

We know that the pandemic has created issues for the IRS and this is one of those issues. The IRS should offer a delay in the March 1 farmer filing or at least put out an announcement ASAP that no penalties will be due this year if a farmer files after March 1 and before April 18 (the actual due date this year).

If you are directly affected by this delay this year, please make sure to reach out to your representative ASAP and have them put pressure on the IRS.

The delay in finalizing tax forms beyond December 31 when there were no changes in tax law is unacceptable and the IRS should not penalize farmers that are unable to E-File their tax returns by March 1.

Filing a return manually really is not an option for these farmers since who knows when the IRS will process the return.