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I need Help Understanding the Taxation Changes

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Mississippi Department of Revenue Taxation Update:

Due to COVID-19, the Mississippi Department of Revenue has extended several filing and payment dates:

 

  1. The filing deadline for Income Taxes has been moved from April 15, 2020 to July 15, 2020. Please note that the Federal filing date was extended to July 15, 2020.
  2. First Quarter 2020 estimated tax payments are extended to May 15, 2020.
  3. All sales, use and local tax payments are extended until the end of the national emergency without requiring interest or penalties. However, returns must be timely filed. Effective March 15, 2020, prior pen alties and interest will not continue to accrue.
  4. Further, withholding tax payments due in April are extended until May 15, 2020.

 


Internal Revenue Service Taxation Update:

Due to COVID-19, the Internal Revenue Service has extended several filing and payment dates and created allowable credits:

 

  1. 2019 Federal Income Tax Payments have been extended to July 15, 2020.
  2. For the period of April 1, 2020 through December 31, 2020 as created through Families First Coronavirus Response Act, Employers with less than 500 employees will receive a tax credit for providing required paid sick leave and family leave, plus related health plan expenses, and employers share of Medicare tax during leave to employees that are unable to work due to COVID-19. Eligible Employees are:
    1. A sick or quarantined employee due to COVID-19
    2. An employee caring for a sick child or other sick person as defined in the Act due to COVID-19
    3. An employee caring for a child because child care provider closed or paid care provider is unavailable due to COVID-19.
  3. ​The Employee Retention Credit is a refundable tax credit against certain employment taxes equal to 50% of qualified wages an eligible employer pays to employees after March 12, 2020, and before January 1, 2020. Eligible employers are those businesses with operations that have been partially or fully suspended due to governmental orders due to COVID-19, or businesses that have a significant decline in gross receipts compared to 2019. The credit is capped at $5,000 per employee. Eligible employers can reduce federal employment tax deposits in anticipation of the credit. They can also request an advance of the employee retention credit for any amounts not covered by the reduction in deposits.

 

The Mississippi Small Business Development Center is an accredited member of America's Small Business Development Centers and is funded in part through a cooperative agreement with the U.S. Small Business Administration through The University of Mississippi. All opinions, conclusions or recommendations expressed are those of the author(s) and do not necessarily reflect the views of the SBA or The University of Mississippi. Reasonable accommodations for persons with disabilities and limited English language proficiency will be made if requested at least two weeks in advance.