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N.C. General Assembly Waives Interest on Tax Payments and Extends Other Deadlines

    Client Alerts
  • May 04, 2020

As part of a broad $1.57 billion COVID-19 relief package approved Saturday, the North Carolina General Assembly has directed Secretary of Revenue Ronald Penny to waive interest on certain tax payments that were originally due in April. Secretary Penny had previously extended the filing and payment deadlines for corporate income, franchise, and individual income taxes from April 15 to July 15, 2020 to mirror the federal extension. Secretary Penny had also announced that no late filing or payment penalties would be imposed but explained that the Department of Revenue lacked authority to waive interest. In a unanimous and bipartisan action, the General Assembly has stepped in to provide that additional relief. The waiver applies if the return is filed and the tax is paid by July 15, 2020. The waiver of interest also applies to corporate and individual estimated tax payments due on or before July 15, 2020.

In addition, the General Assembly extended other statutory deadlines relating to requests for refunds and tax appeals. The statute of limitations for requests for refunds of corporate income, franchise, and individual income tax is extended to July 15, 2020 for requests for refunds that were otherwise due between April 15, 2020 and July 15, 2020. The deadline for requests for departmental review, petitions for contested case hearings, and petitions for judicial review is extended to July 15, 2020 for actions that were otherwise required to be taken between April 1, 2020 and July 15, 2020.

These provisions are contained in Senate Bill 704, while other relief provisions are contained in House Bill 1043. As of this writing, the bills have been presented to Governor Roy Cooper (D) who has said he is reviewing them. The two bills represent the initial legislative action on COVID-19, and the General Assembly is expected to take up additional matters related to the pandemic in the coming days and weeks.

For more information, please contact me or your regular Parker Poe contact. You can also find information about funding for small businesses in the N.C. relief package here.