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March 31, 2020
2020-0805

Treasury and IRS grant further COVID-19 tax relief by extending filing and payment date for gift tax returns

In Notice 2020-20, Treasury and the IRS extended to July 15, 2020, the date to file Form 709, United States Gift and Generation-Skipping Transfer Tax Return, and pay any gift/generation-skipping transfer (GST) tax due on April 15, 2020. The relief applies to individuals affected by the COVID-19 emergency, which is defined as anyone who must file Form 709 (Affected Taxpayer).

Notice 2020-20 makes clear that the relief is automatic and there is no requirement to file Form 8892, Application for Automatic Extension of Time to File Form 709. The Notice further states that an Affected Taxpayer may choose to file Form 8892 by July 15, 2020, to obtain an extension to file Form 709 by October 15, 2020. The October 15, 2020 due date is only for the filing of Form 709 — any gift and GST tax payments postponed by the notice are still due on July 15, 2020.

As a result of the postponed filing and payment dates, interest, penalties and additions to tax for failing to file Form 709 or pay gift and GST taxes will not apply to the period beginning on April 15, 2020 and ending on July 15, 2020. Interest, penalties and additions to tax for postponed Forms 709 and payments will begin to accrue on July 16, 2020.

Implications

Notice 2020-20 is welcome relief to those individuals who must otherwise file Form 709 and/or pay gift or GST tax on April 15, 2020. Prior to this relief, there was some question as to whether Notice 2020-18 (postponing the filing and payment date for income tax returns to July 15, 2020) covered Form 709. While IRC Section 6075(b)(2) provides that any extension of time granted to a taxpayer to file his or her income tax return (using Form 4868) is also deemed an extension of time to file Form 709 (i.e., it is unnecessary to file Form 8892), it was unclear whether Notice 2020-18 would have the same effect. By extending filing and payment relief to Form 709, Treasury and the IRS eliminated any confusion regarding the time for filing Form 709 or a request for an extension to file Form 709.

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