IRS Extends Postponement of Deadline for Gift and Generation-Skipping Transfer Tax Filing and Payment, But Maintains Estate Tax Deadlines

On March 13, 2020, the President issued an emergency declaration instructing the Secretary of Treasury to provide relief from tax deadlines to Americans who have been adversely affected by the COVID-19 emergency (defined as “Affected Taxpayers”).

On March 27, 2020, the IRS issued an advanced notice of Notice 2020—20 which provides additional relief from Notice 2020—18 to taxpayers who have United States Gift and Generation-Skipping Transfer Tax Returns (Form 709) and payments due on April 15, 2020, by including such taxpayers in the definition of Affected Taxpayer. The April 15, 2020 deadline is postponed to July 15, 2020. The three-month relief provided under Notice 2020—20 to an Affected Taxpayer is automatic, and therefore, there is no requirement to file an Application for Automatic Extension of Time to File Form 709 and/or Payment of Gift Generation-Skipping Transfer Tax (Form 8892) to obtain the benefit of the filing and payment postponement deadline of July 15, 2020. However, the Affected Taxpayer must file a Form 8892 by July 15, 2020, to obtain an extension to file Form 709 until October 15, 2020. Nevertheless, any Federal gift and generation-skipping transfer tax payments will still be due on July 15, 2020.

Accordingly, the period beginning on April 15, 2020, and ending on July 15, 2020, will be disregarded in the calculation of any interest, penalty, or addition to tax for failure to file a Form 709 or to pay federal gift and generation-skipping transfer taxes shown on the respective Form 709. Interest, penalties, and additions to tax with respect to such postponed Form 709 and payments will begin to accrue on July 16, 2020.

Please note that neither Notice 2020—18 nor Notice 2020—20 postponed the due date for filing United States Estate (and Generation-Skipping Transfer) Tax Returns (Form 706).