State & Local Tax Impacts of COVID-19 for Tennessee – 2021

Thoughtware Alert Published: May 03, 2021 | Updated: Jun 08, 2021

Information current as of April 30, 2021.

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 Tennessee

  • Tennessee announced that, consistent with the IRS decision to extend the filing deadline for individuals, the department has extended the due date for filing and paying the Hall income tax from April 15, 2021, to May 17, 2021. This extension will automatically apply; no further action is required. The department also has extended the franchise and excise tax due date from April 15, 2021, to May 17, 2021, for individuals who file a Tennessee franchise and excise tax return using Schedule J2, Computation of Net Earnings for a Single Member LLC Filing as an Individual. This extension also will automatically apply. Interest and late filing penalties won’t be applied to returns filed and payments made on or before the May 17 extended due date. The October 15, 2021, six-month extension date for calendar-year 2020 tax returns remains unchanged. Estimated payments due on April 15, 2021, aren’t included in this extension; those estimated payments are still due April 15.
    • Tennessee DOR, Important Notice No. 21-02; March 19, 2021.
  • Tennessee legislation excludes certain COVID-19 relief payments received between March 1, 2020, and December 31, 2021, from being included in the calculation of net earnings for corporate income tax. These relief payments are as follows: 1) Tennessee Business Relief Program; 2) Supplemental Employer Recovery Grant Program; 3) Coronavirus Agricultural and Forestry Business Fund; 4) Hospital Staffing Assistance Program; 5) Emergency Medical Services Ambulance Assistance Program; 6) Tennessee Small and Rural Hospital Readiness Grants Program; and 7) payments issued by Tennessee from the federal Child Care and Development Block Grant. Per the Department’s previous guidance, eligible COVID-19 relief payments received by a taxpayer during 2020 would be deducted on the taxpayer’s 2020 franchise and excise tax return, and eligible payments received during 2021 would be deducted on the 2021 return.
    • Tennessee H.B. 776, effective April 14, 2021.
    • Tennessee DOR, Notice 21-03; April 15, 2021.

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

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