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State to hit pause on processing paper tax returns

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ANNAPOLIS — Comptroller Peter Franchot has announced that his office will halt processing paper tax returns temporarily starting April 15 in an effort to keep essential employees safe amid the spread of COVID-19.

In a news release Monday, April 6 announcing the move, Franchot urged Maryland taxpayers seeking refunds to file electronically as soon as possible.

“We remain committed to getting refunds into taxpayers’ bank accounts during this economic crisis. However, we must balance that with our commitment to protecting the health of those dedicated essential employees who have continued reporting to work to process returns and distribute refunds in a timely manner,” Franchot said in a statement.

The decision to temporarily stop processing paper returns after April 15 will further reduce the staff who are required to work on site as the electronic filing process requires minimal human intervention, the release states.

Most taxpayers receiving refunds have already filed and the number of those anticipating refunds who have yet to do so and plan to file via paper returns is very low, according to the release.

For those taxpayers who must file paper returns and anticipate a refund, Franchot encourages them to do so by April 10 to ensure they will be processed before the April 15 temporary suspension.

The agency will continue to monitor the situation closely and could alter the schedule if necessary, the release states.

“I commend our employees — both the small group of staff still reporting to the office, as well as those working from home — for their continued commitment to the taxpayers who pay their salaries and who are relying on their refunds to make it through these incredibly difficult economic circumstances,” Franchot said.

While April 15 would have been Tax Day as usual this year, the COVID-19 pandemic has led Franchot’s office and the Internal Revenue Service to push the deadline for individuals and businesses to file and pay state and federal income taxes to July 15.

In addition, the IRS and the state announced that any income tax payments due April 15 will not be subject to interest or late fees if made by July 15.

“Right now, Maryland taxpayers and businesses must stay focused on their health and keeping their lights on, both in their homes and businesses,” Franchot said announcing the extension. “Extending the due date for Maryland state individual and business income tax payments helps us keep cash flowing in our economy and into employees’ bank accounts.”

For Maryland businesses, Franchot extended sales and use tax payments due in March, April and May to June 1. Interest and penalties will be waived, according to a news release. This includes: withholding tax; admissions and amusement tax; alcohol, tobacco and motor fuel excise taxes; tire recycling fees; and Bay restoration fee returns.

Those seeking assistance from the IRS on their federal taxes are being directed to a special COVID-19 page on the agency’s website, irs.gov/coronavirus. The site offers a number of online resources to help tax filers, while assistance centers are closed due to COVID-19.

“In response to the national emergency and to protect our employees, America’s taxpayers, communities and our partners, the IRS has temporarily closed all Taxpayer Assistance Centers and discontinued face-to-face service throughout the country until further notice. The IRS is continuing to process tax returns, issue refunds and help taxpayers to the greatest extent possible,” the website states.

State tax filers may email any questions to taxhelp@marylandtaxes.gov. A news release cautions that response times may be affected as staff will be prioritizing processing tax returns and getting refunds out.

“For many Marylanders who are financially struggling to survive this crisis, their tax refunds will be a huge relief, so we want our very limited on-site workforce remaining to prioritize getting that money to them as quickly as possible,” Franchot said. “By extending the filing and payment deadline for individual and corporate income taxes to July 15, as well as postponing most business tax payments until June 1, we’ve given taxpayers extra breathing room and allowed our staff to continue answering taxpayer questions without having to report to state offices.”

For more information, visit marylandtaxes.gov.

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