Jennifer Schmidt has recovered from the siege of last summer, but has not forgotten how weary she was. That is one reason why she embraces a second annual tax day delay.
“The delay is going to be appreciated in this office,” said the owner of Jennifer Schmidt Tax and Accounting in Centerville.
March 17, St. Patrick’s Day, was a lucky day for Schmidt and many of her tax-preparing peers. The Treasury Department and Internal Revenue Service announced that day they were pushing back the filing deadline for individual federal income tax returns for 2020 from April 15 to May 17.
Shortly thereafter, Pennsylvania, West Virginia, Ohio and other states delayed the filing of state returns to May 17 as well. The Keystone State deadline, under Pennsylvania law, is the same as the federal deadline.
As with just about everything, blame it on the coronavirus. As IRS Commissioner Chuck Rettig said on St. Paddy’s Day: “This continues to be a tough time for many people, and the IRS wants to continue to do everything possible to help taxpayers navigate the unusual circumstances related to the pandemic, while also working on important tax administration responsibilities.”
The pandemic, which began assaulting the Keystone State last March, caused backlogs of 2019 returns that the IRS, with limited staffing, had difficulty handling. Some individuals – especially those who filed paper returns – are still awaiting refunds as they plan to file their 2020 taxes.
Those circumstances a year ago forced the federal and Pennsylvania governments to extend the filing deadline to July 15.
Revenue Secretary Dan Hassell told the Associated Press that the delay in Pennsylvania “is a positive step that provides additional time to taxpayers, many of whom have been struggling during the last year. The new deadline will be a benefit for many Pennsylvanians, including those who plan to meet with a tax professional for assistance with preparing their returns.”
Schmidt, in a January interview with the Observer-Reporter for a separate story, predicted in late January that there would be another delay. She said at the time: “I think we’ll see the April 15 deadline system extended. I would not be surprised if they extend it to July 15.”
She said the IRS has had to deal with a lot, including the processing of Recovery Rebate Credits last year and the recently enacted American Rescue Plan, the $1.9 trillion economic stimulus bill.
“I don’t think they’ve been able to catch their breath, just as we could not,” Schmidt said.
“Things have not been smooth since the pandemic hit. A lot of people have been out of work since last March and are still not back. Twenty percent of our clients have collected unemployment (compensation). Clients are looking for documents that were lost in the mail.”
Cutting through the morass isn’t easy, but one way to minimize the mess, according to the IRS, is to file as early as feasible. A taxpayer also can apply for an extension to Oct. 15.
In the meantime, work continues to pile up for the IRS, Pennsylvania’s Revenue Department and state tax governing bodies. And for tax preparers.
Jennifer Schmidt will, indeed, appreciate the delay.
“We have a big pile of returns to process,” she said. “I’m hoping to get a summer break this year.”