IRS Reportedly Plans to Extend Tax Deadline Till About May 15

The IRS is reportedly ready to extend the tax-payment deadline to about May 15. Last year, the deadline was extended to July 15 because of the pandemic.
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The Internal Revenue Service plans to extend the income-tax-payment deadline by about a month from the usual April 15 date, media reports say.

Last year, the deadline was extended until July 15 because of the Covid pandemic. The exact date for this year remains to be determined, knowledgeable sources told Bloomberg. 

An extension would again allow taxpayers to deal with pandemic-related issues.

The Biden administration is considering tax increases for future years to deal with the exploding budget deficit, which totaled $3.1 trillion in fiscal 2020, ended Sept. 30.

In other tax news, TurboTax explained to TheStreet.com last week that the tax issues that arise in the state in which you are working during the pandemic may differ from those in the state in which you reside full time. And “you may be on the hook for taxes in two states,” says TurboTax Blog Editor Lisa Greene-Lewis.

TurboTax also provided TheStreet.com with commentary about how gig workers can limit their tax bills. That includes pass-through deductions for independent contractors.

TheStreet.com’s Paul Price offered tips for option traders to save on their taxes. He cites five important things to know:

  1. “Options are never taxed when they are initiated.
  2. Expired options show taxable profits or losses in the tax year when they expire.
  3. Exercised options are not taxable as separate transactions.
  4. Purchased long-term options (know as Leaps) can qualify for long-term capital gains tax rates if held for more than one year and then sold to close.
  5. Short sales of options can never qualify for long-term capital gains rates if they expire or are closed for profits, even if more than one year has elapsed from opening to closing.”