On Friday, Governor DeWine signed HB 197, a bill that provides instruction and relief in many areas regarding the impacts of the coronavirus. This bill also authorized the State Tax Commissioner to change the due date for filing Ohio income tax returns. Since the individual municipal income tax due date was directly tied to this date, municipalities could not take official action until this was accomplished. Within hours of the Governor signing this bill, the State Tax Commissioner made an official declaration regarding due dates. This press release is in the link below.
https://www.tax.ohio.gov/Portals/0/communications/news_releases/Incometaxfilingextended03272020.pdf
It was clearly the intention of the Governor and the Tax Commissioner to provide relief for any calendar year taxpayer by extending the due date of the annual return from 4/15/20 to 7/15/20, consistent with the change in date by the IRS. Because of an official State of Emergency declaration by the Governor, it is not possible for taxpayers (individual and net profit) to comply with a 4/15 due date.
While the press release from Commissioner McClain provides relief for individual taxpayers, extending their filing and payment date to 7/15/20, and also provides relief to municipal net profit tax filers who have opted to have the State Tax Commissioner administer their municipal net profit tax, it could not provide equitable relief for those municipal net profit filers who continue to file directly with each municipality. To remedy this matter, the municipal income tax administrator has the authority under the Ohio Revised Code to waive penalty (including late filing and late payment penalty) and interest when deemed appropriate. Under this authority, municipal tax administrators should hereby waive penalties and interest for calendar year municipal net profit tax filers through 7/15/20, thus creating equitable and fair treatment for these taxpayers. During this State of Emergency, we must provide this extension to 7/15/20 to comply with the intent of the Emergency Declaration and the Governor's orders - to keep all Ohioans safe and healthy.
In addition to the filing due dates, the State Tax Commissioner's press release provided new dates for the payment of first and second quarter tax year 2020 estimated tax payments, which we should also implement. This will provide uniformity and continuity for those taxpayers who are liable for tax year 2020 estimated tax payments.
TO RECAP:
- Individual taxpayers will have until 7/15/20 to file and pay their 2019 municipal income tax return.
- Net profit taxpayers (calendar year) who have opted to file with the State Tax Commissioner will have until 7/15/20 to file and pay their 2019 municipal income tax return with the State.
- Net profit taxpayers (calendar year) who file directly with the tax administrator of the municipal corporation will have until 7/15/20 to file and pay their 2019 municipal income tax return.
- First and second quarter estimated tax payments (individuals and calendar year net profit tax filers) will both be due by 7/15/20.
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