State & Local Tax Impacts of COVID-19 for Texas – 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 Texas

  • The state is granting an extension of up to 90 days past the original due date to pay the motor vehicle tax due on purchased motor vehicles. The extension does not apply to seller-financed motor vehicles sales.
    • Texas Comptroller COVID-19 News, March 23, 2020.
  • Texas automatically extended the due date for 2020 franchise tax reports and payments to July 15, 2020, for all franchise taxpayers. Taxpayers do not need to file any additional forms.
    • Texas Comptroller COVID-19 News, April 2, 2020.
  • Texas announced a 60-day extension of 2019 independently procured insurance excise tax filing and payment (upon request). Taxpayers granted the 60-day extension that need more time to file and pay the tax can apply for an additional 30-day extension on or before July 15.
    • Texas Comptroller COVID-19 News, April 1, 2020.
  • In the Texas Tax Policy News May edition, the comptroller addressed the taxability of COVID-19 surcharges assessed by businesses, stating that fees and surcharges charged by Texas businesses related to the COVID-19 pandemic are charges that businesses have chosen to pass along to recoup the higher costs of goods and services provided to their customers. For Texas sales tax purposes, additional fees and surcharges related to the selling price of a taxable item are considered part of the sales price and are subject to tax in the same manner as the item or service being sold.
    • Texas Tax Policy News, May 27, 2020. 
  • The Texas comptroller released a newsletter in August stating that the deadline for filing a franchise tax second extension request for mandatory electronic payers is August 17. Entities that properly secure a second extension (after filing a first extension by July 15) will have until January 15, 2021, to file their report (the due date is extended from November 15 as a relief from the COVID-19 pandemic).
    • Comptroller Newsletter, August 13, 2020. 

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

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