When do I file IRS Form 7200?
Any qualifying businesses and tax-exempt organizations can file the IRS Form 7200 anytime during a month following the quarter in which the qualified wages are paid and request an advance payment of the credits. Also, businesses are allowed to file Form 7200 multiple times.
For instance, if your business files Form 941, the Employer's Quarterly Federal Tax return for every quarter, the deadline to file for the second quarter is July 31, 2020. Now, the Form(s) 7200 applicable to the second calendar quarter (April through June) is filed anytime from April 1, 2020, through July 31, 2020. Though the due dates are the same, the Form(s) 7200 must be filed before Form 941. Doing this allows you to reconcile any advance credit payments and reduced deposits for the first quarter of 2020. Once you filed Form 941, you cannot file Form 7200 for the same quarter.
The tax credits for the qualified sick and family leave wages are applicable to wages paid from April 1, 2020, to December 31, 2020. Also, the employee retention tax credit available due to suspension of operations, government shutdown or significant reduction in gross receipts is applicable to wages paid after March 12, 2020, and before January 1, 2021.
As the IRS finalized Form 7200 by April 1, the employers who paid qualified wages to the employees anytime between March 13, 2020, and March 31, 2020, (during the quarter 1), has to choose calendar quarter 2 (April, May, June) on Form 7200.
Likewise the businesses that file the annual federal tax returns form 943, 944, or CT-1 for 2020, should not file Form 7200 after the federal tax returns are filed. Also, you can’t request an advance payment for the anticipated credit for which you already reduced your deposits.