June 2 - Final Due Date for IRA Trustees to Issue Form 5498

Final deadline for IRA trustees to issue Form 5498, which provides IRA owners with the fair market value (FMV) of their IRA accounts as of December 31, 2024. The FMV of an IRA on the last day of the previous year (December 31, 2024) is used to calculate the necessary minimum distribution (RMD) that must be made from the IRA if you are 73 or older in 2025.

June 10 - Report Tips to Employer

If you are an employee who works for tips and got more than $20 in tips in May, you must report them to your employer using IRS Form 4070 by June 10. Your employer is required to deduct FICA and income tax withholding for these tips from your normal pay. If your regular wages are insufficient to pay FICA and tax withholding, your employer will record the uncollected withholding in box 8 of your annual W-2. When you file your annual return, you will be obligated to pay any uncollected withholdings.

June 16 - Estimated Tax Payment Due

This is the last day to send in your second quarter anticipated tax installment payment for the 2025 tax year. Our tax system is a "pay-as-you-earn" model. To help taxpayers comply with the "pay-as-you-earn" rule, the government has provided numerous options. This includes:

• Payroll withholding for employees.
• Pension withholding for retirees.
• Estimated tax payments for self-employed and non-withholding income sources.

When a taxpayer fails to prepay a safe harbor (minimum) amount, they may face an underpayment penalty. The penalty is equal to the federal short-term rate + 3 percentage points, and it is assessed quarterly.

The federal tax code does offer options to avoid the underpayment penalty. If the underpayment is under $1,000 (the "de minimis amount"), no penalty is imposed. In addition, the law permits "safe harbor" prepayments. There are two safe harbors.

• The first safe harbor refers to the current year's tax payable. If your payments equal or surpass 90% of what is outstanding in the current year, you can avoid the penalty.
• The second safe harbor is based on the previous tax year. This safe harbor typically covers 100% of the prior year's tax liability. However, for taxpayers with AGIs more than $150,000 ($75,000 for married taxpayers filing separately), the previous year's safe harbor is 110%.

Example : you owe $10,000 in taxes and have $5,600 in prepayments. As a result, you owe an additional $4,400 on your tax return. To determine whether you owe a penalty, check to see if you fall under the first safe harbor exception. Because 90% of $10,000 equals $9,000, your prepayments fell short of the threshold. You cannot avoid the penalty under this exception.

However, in the preceding situation, the safe harbor may still apply. Assume that your previous year's tax was $5,000. Because you prepaid $5,600, which is more than 110% of the previous year's tax (110% = $5,500), you are eligible for this safe harbor and can avoid the penalty.

This example emphasizes the significance of making enough prepayments, especially if you have a significant increase in income. This is typical when there is a significant gain from the sale of stock or property, when large bonuses are paid, when a taxpayer retires, and so on. The safe harbor exception to the penalty requires timely payment of each required estimated tax installment. If you have any queries about your safe harbor calculations, please call this office as soon as possible.

CAUTION : Some state de minimis amounts, safe harbor estimate regulations, and estimated payment due dates differ from those for federal estimates. Please contact this office for specific state safe harbor rules.

June 16 - Taxpayers Living Abroad

If you are a United States citizen or resident alien who lives and works (or is on military service) outside of the United States and Puerto Rico, the filing deadline for your 2024 income tax return and payment is June 16.

If your return has not yet been finished and you require longer time to file it, fill out Form 4868 to request four additional months. Then, submit Form 1040 or 1040-SR by October 15. If you are a participant in a battle zone, you may be entitled to extend the filing date (see below).

Caution: This is not an extension of time to pay your tax liability, but rather an extension to file the return. If you intend to owe, estimate the amount and submit it with the extension. If you owe taxes when you file your extended tax return, you will be subject to both the late payment penalty and interest from the due date.

war Zone - Military taxpayers in a war zone or designated hazardous duty area have extended deadlines for filing with the IRS. This also refers to Service soldiers participated in contingency operations like Operation Iraqi Freedom and Enduring Freedom. The extension is for 180 consecutive days from the later of:

• The last day a military taxpayer was in a combat zone/qualified hazardous duty area, served in a qualifying contingency operation, or performed qualifying service outside of the combat zone/qualified hazardous duty area (or the last day the area qualifies as a combat zone or qualified hazardous duty area).
• The last day of continuous qualified hospitalization for injury from service in a war zone, qualified hazardous duty area, or contingency operation, or while performing qualifying service outside of these areas.

In addition to the 180-day period, the deadline is extended by the number of days left for the individual to file an action with the IRS when they entered a conflict zone/qualified hazardous duty area or began participating in a contingency operation.

It is not advisable to postpone filing your return because you owe taxes. Late filing penalties are 5% each month (up to 25%), which can be considerable. It is often best to file the return without payment to avoid the late filing penalty. We can also set up an installment agreement, allowing you to pay your taxes over a period of up to 72 months.

Please contact this office if you need assistance with an extension request or an installment agreement.

Weekends & Holidays:

If a due date comes on a Saturday, Sunday, or legal holiday, it is automatically extended to the following working day that is not a legal holiday.

Disaster Area Extensions:

Please keep in mind that when a geographic area is classified as a disaster area, deadlines will be extended. For further information on whether an area has been declared as a disaster area and the filing extension dates, please visit the following websites:

FEMA: https://www.fema.gov/disaster/declarations

IRS: https://www.irs.gov/newsroom/tax-relief-in-disaster-situationsJune 2025 Business Due Dates

June 2025 Business Due Dates

June 16 - Employer’s Monthly Deposit Due

Employers who follow monthly deposit requirements must submit Social Security, Medicare, and withheld income tax for May 2025 by June 16. This is also the deadline for the nonpayroll withholding deposit for May 2025, assuming the monthly deposit rule applies.

June 16 - Corporations

Deposit the second installment of 2025 projected income tax for calendar-year corporations.

Weekends & Holidays:

If a due date comes on a Saturday, Sunday, or legal holiday, it is automatically extended to the following working day that is not a legal holiday.

Disaster Area Extensions:

Please keep in mind that when a geographic area is classified as a disaster area, deadlines will be extended. For further information on whether an area has been declared as a disaster area and the filing extension dates, please visit the following websites:

FEMA: https://www.fema.gov/disaster/declarations

IRS: https://www.irs.gov/newsroom/tax-relief-in-disaster-situations