June 23, 2020
By Victor Riches
Earlier this year, in response to the coronavirus, the federal government wisely extended the tax filing deadline from April 15 to July 15. This simple action has afforded millions of Americans an extra 90 days not only to file their 2019 tax returns, but also to defer their tax payments by three months. In a time of unprecedented economic uncertainty, this additional time has been a budgetary lifeboat to countless families and small businesses across the country.
Now, with July 15 rapidly approaching, there is renewed talk of moving the deadline back again, with some suggesting the date be pushed into 2021. While it made sense to push the filing deadline into July while our country dealt with the immediate effects of the coronavirus, any further deference of the filing deadline would create a fiscal and regulatory train wreck at all levels of government.
It would also preclude $60 billion in tax refunds from being returned to taxpayers. These are dollars that would be a welcome and immediate infusion of cash into our struggling economy. Perhaps most importantly, delaying the filing deadline would be a logistical and financial calamity for families across the country who would have to file tax returns for two separate fiscal years in the same 2021 calendar year. This would place an additional burden on an economy that will likely still be in a fragile state.
One way to ease the burden and anxiety of taxpayers is to keep the July 15 tax filing deadline, but allow tax relief in the form of deferring tax payments further. This move would help unemployed workers more easily rejoin the workforce and would give small and medium-sized businesses a stronger footing as the economy slowly reopens and normalizes. Additionally, it is important that the federal government recognize that deferring tax payments during a global pandemic should not result in any additional fees or interest payments to our country’s beleaguered taxpayers.
At a time when economic stability is needed most, maintaining the current July 15 filing date while providing additional tax payment relief will help ensure a more rapid recovery from the fiscal horrors that have afflicted our economy—and the livelihood of countless Americans—during one of the most trying time in our nation’s history.
Victor Riches is the President and CEO of the Goldwater Institute.