If you’re a small business or accountant, the bulk of your tax work is likely already out of the way. For most employers and accounting professionals, January is the busiest part of tax season. Between sending out W-2s and 1099s, calculating year-end totals, and figuring out which forms you need to file, the early months of the year require the most labor. At this point, you’re either finished with taxes for 2019 or rushing to file an extension.
However, federal and select state tax deadline have moved further into the year, which may slightly change your operations for the next several months. This is especially true for those working as CPAs or in accounting firms. You’ll need to answer last-minute questions about missing forms, or perhaps complete a client’s taxes personal later than usual. These employee- and individual-created issues will be unavoidable, so it’s important to do what you can to prepare.
Changing the Tax Filing Deadline
Tax season is set to look a bit different this year. On March 21, 2020, the Internal Revenue Service announced an extension of the federal filing and payment deadline. As a result of economic and social disruptions caused by the ongoing COVID-19 outbreak, the extension moves the typical April 15 date back to July 15 for 2020. Shortly after this announcement by the federal government, several states moved their state tax deadlines back to July 15. People who have already filed their 2019 taxes have nothing to worry about. Those who saved filing for late March or early April will now have an additional four months to finish the task.
For many accountants and businesses, this could mean an influx of questions from employees regarding their taxes, missing forms, and unemployment. Understanding that the next few months will look like is the best way to anticipate the upcoming change in workflow.
Preparing for the Tax Filing Extension
The tax filing extension will have various impacts on businesses. The most likely result, however, is that employees choosing to file in the summer might realize they are missing an important form. When this happens, you’ll need to provide them with the document, whether it be a W-2, a 1099, or something else. If this happens, it’s important to have a payroll or filing software that records all transactions and saves forms once they’re complete. If you use AMS Payroll or our W2 and 1099 Filer, this will likely be as simple as printing out a new copy of the employee’s form.
In some cases, employees or clients may have general questions about their taxes. While these might typically occur earlier in the spring, you should be prepared to answer them well into the 2020 summer. Additionally, unemployment filings are increasing by the week, and your company may have recently laid off or furloughed employees. These workers are likely unsure of potential unemployment benefits, and they may have questions related to filing for unemployment and whether their taxes will be impacted. Anticipate answering these types of questions as stay-at-home orders extend into the year.
Answering Tax Filing Questions
In most cases, the questions you receive from employees and clients can be resolved with just a few minutes in the office. However, as social distancing protocols extend into the summer, this will become increasingly difficult. If you’re working from home, consider advertising alternative methods of contact, whether it be a phone call or a Zoom video chat session. If you’re finding that many employees have questions about their forms, consider drafting a Frequently Asked Questions page to distribute to the company. The next few months are going to look different for most accounting professionals, but using these communication methods can mitigate any trouble that may arise.