State & Local Tax Impacts of COVID-19 for Connecticut – 2020

Thoughtware Alert Published: Dec 11, 2020 | Updated: May 05, 2021

Information current as of December 31, 2020.

COVID-19 has changed life across the globe. Many taxing jurisdictions are taking mitigating actions to create social distance and aid taxpayers. The following is a running list of actions by jurisdiction, which generally result in additional time to file and/or pay. Further, many jurisdictions have closed their offices to in-person use by taxpayers and suspended their audit and administrative functions. This alert doesn’t cover similar waivers from local-level taxing authorities. These developments continue to quickly evolve; check with your BKD Trusted Advisor or visit our COVID-19 Resource Center for current information as needed.

Information Specific to Connecticut

  • The filing deadlines for various annual tax returns due on or after March 15, 2020, and before June 1, 2020, are extended by at least 30 days.
  • The 2019 Form CT-1120 and CT-1120CU Connecticut corporation business tax return filing date and payment deadline is extended to June 15, 2020.
  • The 2019 Form CT-1065/CT-1120 SI Connecticut pass-through entity tax return filing date and payment deadline is extended to April 15, 2020.
  • The 2019 Form CT-990T Connecticut unrelated business income tax return filing date and payment deadline is extended to June 15, 2020.
    • DRS Extends Filing Deadline for Certain Annual State Business Tax Returns, March 16, 2020.
  • Individual income tax return and payment deadlines are extended from April 15 to July 15, 2020. The extension also applies to estimated tax payments for the first and second quarters of 2020.
    • Connecticut DRS Notice, March 20, 2020.
  • Connecticut announced an automatic two-month extension of filing and payment deadlines for sales and use and room occupancy tax for taxpayers with $150,000 or less in annual tax liability.
    • Connecticut DRS Notice, March 30, 2020.
  • Connecticut is providing relief for property and excise taxpayers including: 1) modifying tax filing and payment requirements for licensees authorized to operate off-track betting from daily to weekly; 2) suspending the reapplication filing requirement for the Homeowners’ Elderly/Disabled Circuit Breaker Tax Relief Program and for the Homeowners’ Elderly/Disabled Freeze Tax Relief Program; 3) extending the deadline to file income and expense statements until August 15; 4) suspending foreclosures through nonjudicial tax sales until 30 days after the end of the COVID-19 emergency; and 5) requiring municipalities to provide temporary tax forbearance of property tax collection and reduced interest on delinquent tax payments to property owners under certain conditions.
    • Governor’s Executive Order No. 7S, April 1, 2020.
  • Connecticut has clarified its tax extensions as July 15, 2020, for annual and estimated tax returns and payments for the following types: corporation business tax due between March 15 and July 15, 2020; pass-through entity tax due between March 15 and July 15, 2020; unrelated business income tax due between March 15 and July 15, 2020; estate and trust income tax due between April 1 and July 15, 2020; and individual income tax and first- and second-quarter estimated payments for 2020.
    • Connecticut DOR Notice, April 14, 2020.
  • Connecticut has extended by an additional 90 days the 60-day filing requirement for taxpayers seeking to protest a notice of assessment or proposed disallowance of a claim for refund, as authorized by Gov. Ned Lamont’s Executive Order No. 7M. In addition, DRS is providing guidance to taxpayers regarding the effect of Lamont’s Executive Order No. 7G and various Connecticut Judicial Branch orders on the statutory deadlines for filing tax appeals.
    • Connecticut Announcement No. 2020(7), May 8, 2020.
  • Connecticut clarified that federal economic impact payments in the form of federal stimulus checks and loans forgiven under the CARES Act Paycheck Protection Program aren’t subject to Connecticut corporation business tax or individual income tax. However, coronavirus-related distributions from qualified retirement accounts, as permitted under the CARES Act, are generally subject to Connecticut income tax withholding. The clarification also states that the federal five-year net operating loss carryback provision enacted under the CARES Act doesn’t affect Connecticut income tax returns, as Connecticut separately determines NOLs. However, excess business loss limitation for noncorporate taxpayers under IRC §461(l) carries through to the Connecticut income tax returns.
    • Connecticut DOR Guidance OCG-10, July 6, 2020.
  • Connecticut clarified the effect of changes enacted by the CARES Act, which revised the depreciable life of certain QIP and made them eligible for bonus depreciation. For corporation business tax purposes, Connecticut conforms to the calculation of depreciation under the IRC, except for IRC §168(k). Therefore, Connecticut conforms to the changes made to the depreciable life of QIP by the CARES Act but doesn’t conform to the ability to claim bonus depreciation on such assets.
    • Connecticut DOR Guidance OCG-11, July 6, 2020.
  • Connecticut is further suspending and modifying tax deadlines and collection efforts pursuant to Executive Order Nos. 7S and 7W for property and excise tax purposes. The measures include declaring that the Deferment Program and Low Interest Rate Program, which offer relief to eligible taxpayers, businesses, nonprofits, and residents, applies to tax deadlines and collection efforts for tax bills due and payable on January 1, 2021. Municipalities are required to participate in one or both programs.
    • Governor’s Executive Order No. 9R, December 16, 2020.

For more information, reach out to your BKD Trusted Advisor or use the Contact Us form below.

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