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January 29, 2021

Michigan grants 33-day extension for income tax withholding returns and payments due on January 20, 2021 for certain taxpayers affected by COVID-19 closures

The Michigan Treasury Department announced that it is again extending the deadline for filing monthly or quarterly sales, use, and withholding returns and remitting tax payments for non-accelerated sales, use, and withholding returns and payments due on January 20, 2021. The extension applies for 33 days, with penalty and interest waived, provided these returns and payments are submitted to the Department by February 22, 2021.

The Department had previously announced that it extended the deadline for monthly or quarterly non-accelerated sales, use, and withholding returns and taxes due on December 20, 2020 to January 20, 2021.As a result, taxpayers originally required to file returns and remit tax by December 20, 2020 now have until February 22, 2021 to file and remit without penalty and interest. (See EY Tax Alert 2020-2907, 12-18-2020.)

These filing and tax payments extensions are granted in connection with the COVID-19 emergency order issued on December 7, 2020, by the Michigan Department of Health and Human Services (MDHHS) that prohibited gatherings at certain types of facilities, including most entertainment, recreational, and indoor food service venues, resulting in the continued closure of those facilities.

The waiver of penalty and interest only applies to non-accelerated sales, use, and withholding filers whose business is subject to the prohibition on gatherings under Section 3 of the December 7, 2020 emergency order. This includes, for example, businesses that are entertainment venues,recreational facilities and places of public amusement,and food service establishments with indoor dining. Businesses not subject to a capacity prohibition, such as a business operating under the emergency rules issued by the Michigan Occupational Safety and Health Administration on October 14, 2020, or businesses operating under general occupancy limitations, such as a retail store, are not eligible for the waiver of penalty and interest. Taxpayers should refer to the MDHHS emergency order to determine if the relief under the state's latest deadline extension applies.

The waiver does not apply to any accelerated return or payment of sales and use taxthat may be due on January 20, 2021 and similarly does not apply to any withholding required to be paid on an accelerated schedule. Any taxpayer that currently pays sales, use, or withholding taxes on an accelerated basis must continue to remit tax according to that accelerated schedule.

Form 5081, 2020 Sales, Use, and Withholding Tax Annual Return, remains due on February 28, 2021.All tax periods from 2020, including any periods for which relief has been granted must be included on anoriginalannual return. The filing of an original annual return does not relieve any taxpayer from the requirement to file, by February 22, 2021, any monthly or quarterly return eligible for the relief provided by the Department.

The waiver of penalty and interest provided the latest deadline extension is automatic. Taxpayers do not need to contact or otherwise submit any documentation to the Department to receive this relief.

Contact the Department at +1 517 636 6925 for questions regarding this extension.

For information on the Department's response to COVID-19, go here.


Contact Information
For additional information concerning this Alert, please contact:
Workforce Tax Services - Employment Tax Advisory Services
   • Debera Salam (
   • Kristie Lowery (
   • Kenneth Hausser (


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